Disclaimer: Information found on CryptoreNews is those of writers quoted. It does not represent the opinions of CryptoreNews on whether to sell, buy or hold any investments. You are advised to conduct your own research before making any investment decisions. Use provided information at your own risk.
CryptoreNews covers fintech, blockchain and Bitcoin bringing you the latest crypto news and analyses on the future of money.
The Central Bank of Nigeria (CBN) has shifted its stance on cryptocurrency within the country, lifting the ban on crypto transactions and instructing banks to disregard its earlier prohibition on such activities.
This development is detailed in a circular dated December 22, 2023, bearing reference number FPR/DIR/PUB/CIR/002/003, and signed by Haruna Mustafa, Director of the Financial Policy and Regulation Department at the apex bank.
The circular is titled “Circular to all Banks and other Financial Institutions: Guidelines on Operations of Bank Accounts for Virtual Assets Service Providers (VASPs).”
The apex bank stated that global trends have demonstrated the need for crypto regulation, citing risks related to money laundering, terrorism financing, and the lack of adequate consumer protection measures.
The document noted, “The CBN, in February 2021, issued a circular restricting banks and other financial institutions from operating accounts for cryptocurrency service providers in view of the money laundering and terrorism financing (ML/TF) risks and vulnerabilities inherent in their operations, as well as the absence of regulations and consumer protection measures.”
It continued, “However, current trends globally have shown that there is a need to regulate the activities of virtual assets service providers (VASPs), which include cryptocurrencies and crypto assets. Following this development, the Financial Action Task Force (FATF) updated its Recommendation 15 in 2018 to require VASPs to be regulated to prevent the misuse of virtual assets for ML/TF/PF.”
Furthermore, Section 30 of the Money Laundering (Prevention and Prohibition) Act, 2022, recognizes VASPs as part of the definition of a financial institution.
See Also: Nigeria Has Expressed Interest To Join The BRICS Economic Alliance As Argentina’s Replacement
Related Posts
In addition, the Securities and Exchange Commission issued Rules on Issuance, Offering and Custody of Digital Assets and VASPs in May 2022, providing a regulatory framework for their operations in Nigeria.
In view of the foregoing, the CBN issued this guideline to provide guidance to financial institutions under its regulatory purview regarding their banking relationships with VASPs in Nigeria.
The apex bank noted that this new guideline supersedes its previous directives referenced as FPR/DIR/GEN/CIR/06/010 of January 12, 2017, and BSD/DIR/PUB/LAB/014/001 of February 5, 2021.
It also affirmed that banks and other financial institutions remain prohibited from holding, trading, and/or transacting in virtual currencies on their own accounts.
The bank added that all banks and other financial institutions are required to immediately comply with the new guideline.
In its earlier circular with reference number BSD/DIR/PUB/LAB/014/001, dated February 5, 2021, the apex bank reminded banks that dealing in cryptocurrencies or facilitating payments for cryptocurrency exchanges was prohibited.
At that time, it instructed banks to identify persons or entities transacting in or operating cryptocurrency exchanges within their systems and ensure that their accounts were closed.
Disclaimer: The information provided is not trading advice. Bitcoinworld.co.in holds no liability for any investments made based on the information provided on this page. We strongly recommend independent research and/or consultation with a qualified professional before making any investment decisions.
The post BREAKING! Central Bank Of Nigeria (CBN) Lifts Ban On Cryptocurrency Transactions, Issues New Guidelines appeared first on BitcoinWorld.
