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CBN gives reasons for grounding Cryptocurrencies in Nigeria

Contrary to several experts’ views that Nigeria stands to gain more from its current second position as world number two in cryptocurrencies business, the Central Bank of Nigeria (CBN) has said the transactions promote illegal activities and raise risks, among other reasons.

In a statement regarding various comments and reactions following its recent reminder to Deposit Money Banks to desist from transacting in/and with entities dealing in cryptocurrencies, the apex bank averred that “The recent regulatory directive became necessary to protect the financial system and the generality of Nigerians (including the youth population) from the risks inherent in crypto assets transactions, which have escalated in recent times, with dire consequences for the integrity of the financial system and financial stability.

Continuing, CBN made it clear that “Due to the fact that cryptocurrencies are largely speculative, anonymous and untraceable they are increasingly being used for money laundering, terrorism financing and other criminal activities. “Small retail and unsophisticated investors also face high probability of loss due to the high volatility of the investments in recent times.

“In light of these realities and analyses, the CBN has no comfort in cryptocurrencies at this time and will continue to do all within its regulatory powers to educate Nigerians to desist from its use and protect our financial system from activities of fraudsters and speculators,” the CBN noted.