CBN Bars Banks From Cryptocurrency Transactions

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The Central Bank of Nigeria (CBN) has once again reminded the Deposit Money Banks (DMBs), Non-Bank Financial Institutions (NBFIs), Other Financial Institutions (OFIs) that dealing in cryptocurrencies or facilitating payments for cryptocurrency exchanges is prohibited.

In a letter signed by the Director, Banking Supervision, CBN, Bello Hassan, and Director, Payments System Management Department, CBN, Musa Jimoh, the apex bank directed all banks to identify persons and/or entities transacting in or operating cryptocurrency exchanges within their systems and ensure that such accounts are closed immediately.

TheFact Nigeria reports that CBN in a circular of January 12, 2017 ref FPR1DIR/GEN/C1R106/010, cautioned Deposit Money Banks (DMBs), Non-Bank Financial Institutions (NBFIs), Other Financial Institutions (OFIs) and members of the pubic on the risk associated with transactions in cryptocurrency.

CBN, however, in the letter to the banks noted that that breaches of the directive will attract severe regulatory sanctions.

The letter in parts reads: “The Central of Bank of Nigeria’s (CBN) circular of January 12, 2017 ref FPR1DIR/GEN/C1R106/010 which cautioned Deposit Money Banks (DMBs), Non-Bank Financial Institutions (NBFIs), Other Financial Institutions (OFIs) and members of the pubic on the risk associated with transactions in cryptocurrency refers.”

“Further to earlier regulatory directives on the subject, the Bank hereby wishes to remind regulated institutions that dealing in cryptocurrencies or facilitating payments for cryptocurrency exchanges is prohibited.”

“Accordingly, all DMBs, NBFIs and OFIs are directed to identify persons and/or entities transacting in or operating cryptocurrency exchanges within their systems and ensure that such accounts are closed immediately.”

“Please note that breaches of this directive will attract severe regulatory sanctions. This letter is with immediate effect,” the letter reads.

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