The Governor of the Central Bank of Nigeria, Godwin Emefiele has recently defended the apex bank’s decision in excluding cryptocurrencies from Nigeria’s financial ecosystem.
Appearing before a joint Senate Committee on Banking, Insurance and Other Financial Institutions; ICT and Cybercrime, Godwin Emefiele stated that the Crypto ban was in the best interest of Nigerians.
According to a report by an online media outlet, while addressing the Senate committee, Godwin Emefiele remarked,
“Cryptocurrency is not legitimate money. Cryptocurrency has no place in our monetary system at this time and cryptocurrency transactions should not be carried out through the Nigerian banking system.”
The head of the apex bank affirmed Nigeria’s central bank resolve in continuing its surveillance and deeper understanding of the crypto ecosystem, buttressing that its major objective remains to educate Africa’s largest economy on emerging financial risks and protect Nigeria’s financial system from the activities of money launderers, currency speculators, and foreign-based fraudsters.
Recall in a press release dated, the 7th of Feberuary 2021, the CBN had explained in detail the motives for its directive to Deposit Money Banks (DMBs) and other financial institutions to desist from transacting in and with entities dealing in cryptocurrencies.
“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 a 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 their use and protect our financial system from the activities of fraudsters,” the CBN stated.
What you should know: The CBN, some weeks ago issued a circular prohibiting banks and other financial institutions from carrying out transactions in cryptocurrencies or facilitating payments for crypto exchanges.
- The CBN’s directive has since gotten very harsh reactions on social media with many condemning the policy as a deliberate attempt by the government to impoverish young Nigerians who have been able to create wealth for themselves through crypto trading.
- Interestingly, Nigeria along with other countries ranked as the worst countries to start a career do not wholly accept or legally recognize cryptocurrency and other digital assets.
By Olumide Adesina