The Central Bank of Nigeria (CBN) has refuted a report suggesting that it issued a directive mandating banks and financial institutions to identify individuals or entities engaging with cryptocurrency exchanges and enforce a "no debit" (PND) restriction on such accounts for six months. A "no debit" order entails banks limiting certain transactions on a customer's account, preventing them from making withdrawals or payments during the specified period.
Initially denying the report on social media platform X, the CBN later deleted the denial, sparking confusion. However, hours later, the central bank reiterated that the allegations were indeed false. The purported directive also purportedly aimed to crack down on those transacting with Tether illegally, especially via peer-to-peer (P2P) methods.
The alleged notification further claimed that regulated financial institutions were prohibited from involvement in cryptocurrencies or facilitating cryptocurrency transactions. This apparent directive, though, contradicts the previous ban imposed in 2021, which was lifted in December 2023, permitting banks to facilitate transactions on cryptocurrency exchanges.
After nearly two years of enforcing a blanket ban on banks' participation in digital currency operations, the CBN lifted the ban in recognition of the global demand for and adoption of cryptocurrencies. However, amidst the rapid depreciation of the naira and soaring inflation rates, the government shifted focus to platforms offering cryptocurrency services, banning websites associated with cryptocurrency trading known for setting informal naira valuations.
Binance, a prominent cryptocurrency exchange, faced intensified scrutiny after the CBN expressed concerns about suspicious financial transactions occurring through Binance Nigeria in 2023. CBN head Olayemi Cardoso disclosed that approximately $26 billion flowed through Nigeria via Binance in 2023, originating from undisclosed sources and users. Binance encountered additional hurdles in Nigeria, with its U.S.-based executive Tigran Gambaryan detained and facing charges related to money laundering following discussions with Nigerian officials regarding Binance's regulatory compliance. Nadeem Anjarwalla, another executive involved in these discussions, subsequently escaped from custody and was traced to Kenya, where extradition proceedings are underway.
