The press report claiming that the Central Bank of Nigeria (CBN) had issued an ultimatum to banks to blacklist individuals and organizations involved in cryptocurrency exchanges and impose a six-month Post-no-debit Instructions has been dismissed by the CBN. The alleged order would have prevented account holders from accessing their funds for certain transactions.
Initially, there was doubt when the central bank refused to acknowledge the story, but later they confirmed that the claims were untrue. Instead, the CBN stated that it would take action against anyone found trading Tether publicly and illegally, especially through peer-to-peer methods.
The report also mentioned that regulated financial institutions were prohibited from providing crypto exchange payments, contradicting the previous restriction in December 2023 where banks were allowed to facilitate such transactions.
Interestingly, the CBN lifted the ban on crypto transactions before the expected two-year period after imposing strict regulations on banking entities entering the industry.
In a recent statement, the CBN explained that the significant global demand and increased adoption of cryptocurrencies no longer justified the tight restrictions on financial institutions.
The government’s attention turned towards crypto trading platforms due to the depreciation of the naira and the subsequent inflation of 29.9%. To prevent unofficial exchange rates for the naira, the government disabled websites that facilitated trade outside of government regulation, which carried the risk of significant fluctuations in exchange rates.
Binance, a popular cryptocurrency exchange, has faced regulatory challenges in Nigeria since 2023 when the CBN expressed concerns about suspicious financial transactions through Binance Nigeria.
Currently, Binance’s global head, Tigran Gambaryan, based in the US, is detained in Nigeria and is facing trial for alleged involvement in money laundering and five other charges related to Howit. The Nigerian government contacted Binance regarding compliance with regulations, leading to these charges.
Additionally, one of Binance’s executives, Nadeem Anjarwalla, was arrested and detained by Nigerian security authorities for discussing Binance’s regulatory issues. Anjarwalla managed to escape detention but was later captured in Kenya and is awaiting extradition.
