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UPDATE 1-Nigeria's banks barred from cryptocurrency transactions -central bank

Published 05/02/2021, 16:38
Updated 05/02/2021, 16:43
© Reuters.

(Adds context on bitcoin in Nigeria)
LAGOS, Feb 5 (Reuters) - Nigeria's banks and financial
institutions are barred from dealing in or facilitating
transactions in cryptocurrencies, the central bank said in a
circular on Friday, warning that banks which fail to act could
face "severe regulatory sanctions".
The bank directed institutions to identify individuals and
entities transacting in or operating in cryptocurrency exchanges
within their systems and immediately close their accounts.
Bitcoin use has boomed in Africa in recent years, driven by
payments from small businesses and remittances sent home by
migrant workers. Much of the growth was driven by Nigeria, which has a large,
young, tech-savvy population and a weak national currency, the
naira, which makes it difficult to get the U.S. dollars needed
to import goods or services. But the central bank has argued that cryptocurrencies, which
are unregulated and not legal tender, are risky for the user.
In June, small cryptocurrency transfers totalled nearly $56
million, nearly 50% more than a year before. The number of
transactions jumped over 55% to 120,000.


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