Banks in Nigeria Start Closing Accounts Used for Crypto Transactions

The CBN said it; now it's time for action

Following a circular from the Central Bank of Nigeria last week, warning financial institutions of engaging with crypto, banks have started closing accounts.

The Central Bank of Nigeria(CBN) sent a circular to the country’s financial and non-financial institutions last week warning them of the illegality of dealing and facilitating crypto payments.

The letter was a shocker to the country’s crypto holders and businesses, although it was a sequel to another circular issued in 2017.

Following last week’s directive to identify and close accounts of persons and entities dealing with crypto, local banks have started to comply with the rules. Tech Cabal, a Nigerian tech publication, says, “Several people with accounts in Access Bank woke up to an email from their bank informing them that their accounts were now closed,” in an early morning newsletter.

Crypto exchanges operating in Nigeria and affected customers were notified of the new directive’s impact on their business immediately. Several crypto exchanges in the country, including Binance, Quidax, Buy coins Africa, and Bundle, announced their compliance to the “new” rules early this week.

Nigeria’s apex bank defended the recent circular as a reiteration of its previous stance on cryptocurrencies announced in 2017.

“As regards our recent policy pronouncement, it is important to clarify that the CBN circular of February 5, 2021, did not place any new restrictions on cryptocurrencies,” it said in a follow-up letter. The 2017 circular still forbade banks “not to use, hold, trade and/or transact in cryptocurrencies,” but locals have been trading crypto with their bank accounts until recently.

Transacting crypto with bank accounts is illegal – for now – but the bank said crypto is not forbidden. It promised, however, to do everything in its powers “to educate Nigerians to desist from their use and protect our financial system from the activities of fraudsters.”

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Alvin Wanjala

Alvin Wanjala has been writing about technology for over 2 years. He writes about different topics in the consumer tech space. He loves streaming music, programming, and gaming during downtimes.

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