Godwin Emefiele, Governor of the Central Bank of Nigeria, has suggested that cryptocurrency is unconstitutional and has no role in the monetary system of Nigeria.
Godwin Emefiele, who appeared before the Senate Joint Committee on Finance, Insurance and Other Financial Institutions on Tuesday, February 23, said that the digital currency was used to carry out money laundering, terrorist funding, and other illegal activities.
The CBN Governor, identifying the activities of cryptocurrencies as unsafe and ambiguous, said the use of cryptocurrencies breached an established rule. He said that, considering the fact that unauthorized and unlicensed organizations released cryptocurrencies, it was contradictory to the Bank’s mandate, as enshrined in the CBN Act (2007), declares the Bank to be the legal tender issuer in Nigeria.
Emefiele, who also distinguished between digital currencies that can be released by central banks and cryptocurrencies issued by anonymous and unregulated individuals, emphasized that the anonymity, transparency and concealment of cryptocurrencies were ideal for those engaging in illicit activities such as money laundering, funding extremism, the purchasing of small arms and light guns and tax evasion.
The CBN governor claimed that “Cryptocurrency is not legitimate money,” citing instances of investigated illegal activity that were related to cryptocurrencies is not founded or funded by any Central Bank.
“At this moment, cryptocurrency has no place in our monetary system and cryptocurrency transactions should not be carried out through the banking system in Nigeria,” he stressed.
The ban on cryptocurrency transactions was also sponsored by the SEC Securities and Exchange Commission, the NFIU Financial Intelligence Unit of Nigeria, and the ICPC Independent Corrupt Practices Commission.
On 5 February, the CBN advised banks to close accounts within their networks for individuals or organizations engaged in cryptocurrency transactions.
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