In recent times, there has been a lot of outcry with regard to cryptocurrencies. These outcries are usually from the government who believes that these digital currencies possess a risk. Many countries have their reservation with regard to cryptocurrencies. However, only a few countries like India have come out publicly to attempt to ban crypto trading. The Nigerian government has an active ban on cryptocurrencies. However, many people mistake the details of this ban.
The Governor of the Central Bank of Nigeria (CBN), Godwin Emefiele, recently reiterates the central bank’s position on the use of cryptocurrencies in the country. Speaking on his behalf, CBN Deputy Governor, Adamu Lamtek, said that the bank did not prohibit Nigerian residents from buying, trading, or selling cryptocurrency. However, they can not do this with the assistance of any commercial bank in the country.
We are protecting commercial banks – CBN
The CBN claims that it is protecting the banking industry from cryptocurrency activities. According to Emefiele, cryptocurrencies are “illegal currencies”. He further claims that these currencies have no place in Nigeria’s currency system.
CBN announced in a notice last month that it had banned all regulated financial institutions from providing services to cryptocurrency exchanges in the country. The ban requires all commercial banks to close accounts belonging to the Nigerian Cryptocurrency Exchange. This also affects other companies that have affiliation with cryptocurrency transactions.
The CBN warns that any institution that violates the regulations will be subject to “severe regulatory sanctions”. According to some reports from some Nigerian banks, crypto traders’ accounts are no longer active.
Since CBN introduced the crypto-currency ban, BTC’s trading price in Nigeria has exceeded 70%. However, many regulators and crypto-currency enthusiasts in Nigeria have criticized this ban. The Nigerian Senate proposed to invite the president of CBN and major crypto-currency stakeholders to participate in the hearing to discuss issues related to the country’s crypto regulations.
India to be the first to ban cryptocurrencies
The Indian government is proposing a law that bans cryptocurrency trading. The country will not only ban digital currency, but it will also punish violators severely. The Indian largely believes that cryptocurrency is a “Ponzi scheme”. Also, they believe that this digital currency poses a risk of financial stability.
A report from an Australian regulator shows that a good chunk of financial crimes has links to cryptos. If the Indian ban happens, it will be the first country to openly ban digital currencies.