The Central Bank of Nigeria (CBN) has dismissed reports claiming that they issued an ultimatum to banks to blacklist individuals and organizations involved in cryptocurrency exchanges. The alleged order included imposing a six-month Post-no-debit Instructions to identify and restrict such transactions.
This news raised doubts when the central bank initially denied the reports but later retracted their denial. Hours after the accusations were made, the CBN announced that the claims were false. They stated that they would take action against anyone found publicly trading and selling Tether, particularly using the peer-to-peer method, on unauthorized platforms.
The report also mentioned that all regulated financial institutions providing crypto exchange services are prohibited from doing so. This contradicts the restrictions imposed in December 2023, when banks were allowed to facilitate crypto transactions.
Interestingly, the central bank lifted the ban on crypto transactions before the two-year mark after implementing the initial harsh ban on banking entities entering the industry. The CBN stated in a recent statement that the significant global demand and increasing adoption of cryptocurrencies no longer justify tight restrictions on financial institutions.
There has been increased scrutiny on Binance, a prominent cryptocurrency trading platform, in Nigeria. The devaluation of the naira and the resulting 29.9% inflation forced the government to pay attention to services like crypto trading platforms. To prevent unofficial exchange rates for the naira, the government disabled these websites. These platforms were used to conduct trades outside of government regulations, but they posed a risk of significant fluctuations in the naira’s exchange rates.
Binance has been facing regulatory challenges in Nigeria since 2023 when the CBN expressed concerns about suspicious financial transactions through its Nigerian branch. Tigran Gambaryan, the global head of Binance based in the US, is currently detained in Nigeria after being summoned to stand trial. He is accused of involvement in money laundering and faces five separate charges related to Howit. These charges came about after Nigerian officials contacted Binance regarding regulatory compliance.
One of Binance’s executives, Nadeem Anjarwalla, was arrested and detained by Nigerian security authorities for discussing the platform’s regulatory issues. However, Anjarwalla managed to escape from detention, was later apprehended in Kenya, and is now awaiting extradition.