These sanctions are part of the CBN’s efforts discourage cryptocurrency use and to firmly impose commercial restrictions on cryptocurrency trading.
Three commercial banks in Nigeria were penalized by the Central Bank of Nigeria (CBN), for not following a regulation prohibiting consumers from transacting with cryptocurrencies.
Sanctions by the CBN
The Bloomberg latest report states that the financial institutions were penalized for violating a cryptocurrency trading ban that was imposed a year ago. Stanbic IBTC Bank was fined 500 million Naira by the CBN for using two accounts to conduct crypto transactions.
According to Nigerian Exchange Ltd, Access Bank Plc, the country’s largest lender, was penalized 100 million naira after it failed to close down user crypto accounts. United Bank for Africa (UBA), was penalized 100 million naira for digital-currency transactions made by a customer. Fidelity Bank Plc was the commercial bank that is fully licensed, and was fined 14.3 millions naira.
Wole Adeniyi, chief executive officer, stated that Stanbic IBTC had followed the central bank regulations, but the sanctioned transactions might have gone unnoticed. Adeniyi stated that the central bank could identify relevant transactions because of “advanced capabilities” that not even the national lenders have access to. The platform demanded that the central bank share this technology. The exec speculated that:
“It doesn’t appear that they will entertain a refund but they are now sharing intelligence to us to be in a position to kind of deter clients.”
Nigerian Crypto Climate
Nigeria isn’t particularly crypto-friendly. The largest number of cryptocurrency transactions is made in West Africa, however. According to Chainalysis, the continent’s most populous nation also has the highest proportion of transactions executed by retail users under $10,000.
CBN issued an order in February to close accounts of holders who were involved in the operation or transacting in cryptocurrency exchanges. The circular was sent by the apex bank to all domestic financial institutions and warned them of severe regulatory sanctions for failing to comply.
Eight months after the ban, Nigeria’s financial regulator Securities and Exchange Commission had announced the establishment of a research unit in its efforts to regulate the sector.
Marla Brooks – Financial Analysis
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