Commercial banks in Nigeria have started monitoring customer accounts for cryptocurrency trading. This directive from the Central Bank of Nigeria (CBN) came after it ordered the freezing of the accounts trading cryptocurrency.
CBN’s Directive: Banks Accounts Monitoring in Nigeria
The directive, given through an internal memo, ordered commercial bank employees to monitor bank accounts. CBN requires commercial banks to shut down any account that has any evidence of crypto trading.
Additionally, commercial banks have a directive to flag down two types of accounts. Either a personal bank accounts with large amounts going in and out or accounts of fintech firms that have a large volume of daily transactions without a payments license.
In addition to the accounts mentioned above, accounts that make numerous payments to several beneficiaries and those that receive a lot of money from multiple payees will also be red-flagged.
The directive was also keen to emphasize penalizing employees who fail to disclose an accounts involvement in crypto trading. As per the internally communicated memos, all employees require to ensure their banks are fully compliant with CBN requirements. Additionally, the employees are to monitor customers, transactions and accounts.
Is Cryptocurrency banned in Nigeria?
Although the CBN is currently undertaking steps to regulate crypto trading in Nigeria, the country’s central bank claims that there is no ban in cryptocurrency. Senator Ihenyen, who leads Stakeholders in the Blockchain Technology Association of Nigeria, was quick to point out on his Twitter that CBN’s directive is not only unjust but illegal. Ihenyen shared that the only body that has the authority to oversee Bitcoin regulation is the Nigerian legislature.
Many Nigerian citizens are not happy with the regulatory directive that the country’s central bank has put in place. Twitter user @gaiuchibueze shared that the account he used to support his family had been blocked. He tweeted,
This CBN directive comes less than a week after the launch of the eNaira. The central bank created this token to limit the cases of fraudulent behavior in the digital finance industry. Through the token, CBN also aims at controlling Nigeria’s growing crypto ecosystem.
The eNaira token, the first digital currency in Africa, has been at the development stage for the last three years. The launching of this token came shortly after China’s central bank had also launched its digital currency. However, China and Nigeria are not the only countries with Central Bank Digital Currencies; there are currently 13 other countries that have CBDCs, including Sweden and South Korea.
The CBN launched the eNaira website on September 27. The first step in accessing the eNaira token was downloading the eNaira mobile application. Citizens could also scan a QR code on the website to access and use the tokens. After registration on the website or app, the last step was to create a Speed Wallet. This wallet allows for the sending, receiving and storage of money.