Initially, the CBN prohibited crypto-related transactions in 2021, citing concerns about money laundering and terrorism financing.
However, the regulatory stance has shifted, introducing new guidelines for financial institutions to facilitate crypto transactions, marking a positive turn toward digital currency assets in Nigeria.
Under the revised guidelines released, banks must acquire the bank verification number (BVN) of all directors and owners of crypto businesses they serve.
Additionally, cryptocurrency companies are mandated to obtain licensing from the Securities Exchange Commission (SEC), following the SEC's rules issued in May 2022 governing digital asset offerings and collections.
According to the SEC, virtual assets service providers (VASPs) like crypto exchanges must possess a minimum capital of ₦500 million ($553,000) and register with the Corporate Affairs Commission (CAC).
Notably, crypto firms intending to issue tokens must undergo a stringent process, submitting a white paper to the SEC and awaiting a 30-day approval period before token release.
Despite the relaxation of restrictions, the CBN's latest guidelines prohibit banks from holding, trading, or transacting in virtual currencies.
Experts emphasize the necessity of these checks to protect customer funds, given the volatility of cryptocurrency.
The Central Bank asserts that its updated guidelines align with global standards aimed at regulating crypto usage within the country.
Buchi Okoro, CEO and co-founder of Quidax, expressed optimism about the new measures, foreseeing increased transparency, customer trust in licensed platforms, and reduced instances of financial loss for customers.
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