Almost three years after the Central Financial institution of Nigeria(CBN) restricted banks from working accounts for cryptocurrency service suppliers and customers, it has lifted the ban while nonetheless limiting monetary establishments from instantly transacting digital property.
In a round issued by the CBN Director, Monetary Coverage and Regulation division, Haruna Mustafa, the apex financial institution stated it has issued a tenet to offer steering to monetary establishments beneath its regulatory purview in respect of their banking relationship with Digital Belongings Service Suppliers (VASPs) in Nigeria.
The CBN in February 2021 issued a round limiting banks and different monetary establishments from working accounts for cryptocurrency service suppliers in view of the cash laundering and terrorism financing (ML/TF) dangers and vulnerabilities inherent of their operations in addition to the absence of laws and client safety measures.
Nonetheless, within the round issued to All banks and different monetary establishments, the CBM stated “present traits globally have proven that there’s want to control the actions of digital property service suppliers (VASPs) which embody cryptocurrencies and crypto property.
“Following this growth, the Monetary Motion Activity Drive (FATF) in 2018 additionally up to date tts Suggestion 15 to require VASPs to be regulated to stop misuse of digital property for MLU/TF/PF. Moreover, Part 30 of the Cash Laundering (Prevention and Prohibition) Act, 2022 recognises VASPs as a part of the definition of a monetary establishment.
‘As well as, the Securities and Alternate Fee (SEC) in Could 2022 issued Guidelines on Issuance, Providing and Custody of Digital Belongings and VASPs to offer a regulatory framework for his or her operations in Nigeria.
In view of the foregoing, the CBN hereby points this Pointers to offer steering to monetary establishments beneath its regulatory purview in respect of their banking relationship with VASPs in Nigeria.
The Pointers supersedes the CBN’s circulars referenced FPR/DIR/GENICIR/06/010 of January 12, 2017 and BSD/DIR/PUB/LAB/014/001 of February 5, 2021 on the topic. Nonetheless, banks and different monetary establishments are nonetheless prohibited from holding, buying and selling and/or transacting in digital currencies on their very own account.
Accordingly, all banks and different monetary establishments are hereby required to instantly adjust to the provisions of the Pointers.”
Recall that in 2021, the CBN had slammed a nice of N814.26 million on 5 business banks N814.26 million for contravening its directive to freeze financial institution accounts used for cryptocurrency transactions.
