The Central Bank of Nigeria (CBN) has relaxed its stringent laws on digital asset service suppliers (VASPs), together with crypto exchanges. The apex physique has allowed them to function accounts with banks and different monetary establishments in a major coverage shift.
Local papers outlined the current round that marks a notable change from CBN’s earlier ban.
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Nigeria embraces regulation over ban
In 2021, CBN directed banks to shut accounts related to crypto companies. Nigeria was reportedly preventing cash laundering and terrorism financing issues with the ban. Considering there was no coverage framework on the time to defend retail customers.
However, stories observe that the worldwide shift in direction of crypto laws has led to the comfort of the ban.
In a dialogue with the native paper BusinessDay, a cryptocurrency trade operator expressed optimism, viewing this as an indication of “good times ahead” for Nigeria’s cryptocurrency sector.
While this might imply development alternatives for home crypto-related companies, CBN nonetheless maintains a cautious method.
Trading restrictions are nonetheless in place
Banks in Nigeria will not be permitted to maintain, commerce, or transact in digital currencies. They can solely facilitate crypto transactions as per the brand new guidelines. However, it has offered authorized recognition to digital asset service suppliers (VASPs) below Section 30 of the Money Laundering Act of 2022.
Notably, the Financial Action Task Force (FATF) has mandated that VASPs be regulated to mitigate the dangers of cash laundering and terrorism financing (ML/FT). Furthermore, the inclusion of VASPs in Nigeria’s Money Laundering (Prevention and Prohibition) Act of 2022 necessitates regulatory oversight as monetary establishments.
Crypto is now not unlawful in Nigeria.
It’s truthful to run with this narrative.
— Harri Obi (@Harri_obi) December 22, 2023
Earlier in May, Nigeria’s Securities and Exchange Commission additionally began mulling digital guidelines to enable the itemizing of tokens. Additionally, the SEC launched guidelines on the issuance, providing, and custody of digital property and VASPs.
And now CBN’s most up-to-date tips seem to steer in direction of a extra liberal regulatory framework for cryptocurrencies in Nigeria.
Also Read: Nigerian SEC Mulling Support for Asset-Backed Token Over Crypto
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