The CBN’s stance on digital assets has been called into question by the Securities and Exchange Commission’s recent measures to regulate digital assets, including cryptocurrencies in Nigeria.
The SEC’s ruling effectively legalizes digital assets like cryptocurrencies and NFTs in Nigeria, where the central bank had placed an indefinite ban on them since they were classified as securities rather than currency.
Will the apex bank, however, respond to this new guideline? As they study the legislation that was recently announced on Friday, digital asset aficionados are impatiently expecting the answer of the top bank.
While the SEC has effectively granted this industry legal standing, banks will need to be allowed to assist crypto transactions by the central bank.
For the past five years, the Nigerian Central Bank has maintained a strong stance on cryptocurrency, with the first blow coming on January 12, 2017.
Mr Kelvin Amugo, Director, Financial Policy and Regulation Department, CBN, who announced the ban, noted that it was necessary because virtual currency transactions pose a risk of money laundering and terrorism financing.
The CBN made another statement in 2018 stating that cryptocurrencies are not legal money and are therefore unlawful. On the 5th of February 2021, the apex bank reminded Nigerian commercial banks to adhere to the 2017 guidelines.
The central bank issued a 5-page document describing the reasons for the cryptocurrency ban in Nigeria.
The central bank began by stating that the cryptocurrency prohibition was consistent with those of other countries and international recommendations.
The Securities and Exchange Commission (SEC) has issued guidelines for Digital Assets, raising the need for clarification from the central bank, especially because the agency classed it as a security that may be invested in like stocks or bonds.
The central bank, on the other hand, has yet to release an official statement, which many believe will come soon.
Nairametrics attempted to contact regulator officials for comment but received no response.
Banks are expected to remain unregulated until the central bank cooperates with the SEC.