24th February, 2021
By Muhaimin Olowoporoku
The governor of the Central Bank of Nigeria (CBN), Godwin Emefiele has said that the bank’s decision to prohibit deposits money banks and other financial institutions from supporting cryptocurrency trading was in the best interest of Nigerians.
The CBN governor said this while briefing a joint Senate Committee on Banking, Insurance and Other Financial Institutions; ICT and Cybercrime; and Capital Market, on the directive.
Emefiele who described crypto as dangerous said that crypto use by unregulated and unlicensed entities was against existing law and contravenes the CBN’s mandate enshrined in CBN Act (2007).
He stressed the anonymity of cryptocurrencies issued by unknown and unregulated entities noting that its anonymity made it easy for those who indulge in illegal activities such as money laundering, terrorism financing, purchase of small arms and light weapons, and tax evasion.
Emefiele also cited instances of investigated criminal activities that had been linked to cryptocurrencies. He said that the legitimacy of money and the safety of Nigeria’s financial system was central to the mandate of the CBN, even as he declared that
“Cryptocurrency is not legitimate money” because it is not created or backed by any Central Bank.
“Cryptocurrency has no place in our monetary system at this time and cryptocurrency transactions should not be carried out through the Nigerian banking system,” he added.
The CBN governor urged that the issue of cryptocurrency be treated with caution, as he assured that the Bank would continue its surveillance and deeper understanding of the digital space, stressing that the ultimate goal of the CBN was to do all within its regulatory powers to educate Nigerians on emerging financial risks and protect our financial system from the activities of currency speculators, money launderers, and international fraudsters.