Central Bank of Nigeria Lifts Ban on Crypto Transactions

The Central Bank of Nigeria (CBN) has lifted a ban on transacting in cryptocurrencies.

At the same time, the bank said there is a need to regulate virtual asset service providers (VASPs), including cryptocurrencies and crypto assets, Reuters reported Wednesday (Dec. 27), citing a Friday (Dec. 22) circular issued by the bank.

The CBN imposed a ban on banks and financial institutions dealing in or facilitating transactions in crypto assets in February 2021 due to concerns over money laundering and terrorism financing, according to the report.

However, the Securities and Exchange Commission, Nigeria published regulations in May last year that aimed to find a middle ground between an outright ban and unregulated use of crypto assets, the report said.

In its circular dated Dec. 22, the CBN outlined guidelines for banks and financial institutions regarding the opening of accounts, designated settlement accounts, settlement services, and acting as channels for foreign exchange inflows and trade for firms transacting in crypto assets, per the report. The guidelines emphasize the need for VASPs to obtain licensing from the Nigerian SEC to engage in crypto business.

The circular also states that banks are still prohibited from trading, holding or transacting cryptocurrencies, according to the report.

Nigeria has witnessed a surge in cryptocurrency adoption, particularly among its young and tech-savvy population, the report said. Many individuals have turned to peer-to-peer trading offered by crypto exchanges as an alternative to traditional financial services.

The volume of crypto transactions in Nigeria grew by 9% year over year to $56.7 billion between July 2022 and June 2023, per the report, which cited data from blockchain research firm Chainalysis.

It was reported in October 2021 that despite the ban from their country’s central bank, people in Nigeria had turned to cryptocurrency to conduct business, send payments and guard their savings.

In November 2022, the Securities and Exchange Commission, Nigeria said that it had no plans to make crypto part of its digital asset trading goals until regulators agree to standards that keep investors safe.

The commission said at the time that it would promote investment in “sensible digital assets,” with investment protection while also looking into blockchain technology to drive virtual and traditional investment products.

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Villagers missing in Nigeria two days after suspected nomadic herders kill 140

Nigerian mother-of-three Grace Godwin was preparing food on Christmas Eve when her husband burst into the kitchen and ordered her and the children to run and take cover in the bush after gunmen were spotted in a nearby village.

Soon they heard gunfire, starting an hours-long attack by suspected nomadic herders who rampaged through 15 villages in central Plateau state on Sunday, killing at least 140 people with guns and machetes, officials, police and residents said.

It was the bloodiest violence since 2018 when more than 200 people were killed in Nigeria's central region where clashes between herders and farmers are common.

"We returned at 6 the next morning and found that houses had been burnt and people killed. There are still people missing," Godwin said by phone.

"There is no one in Mayanga (village), women and children have all fled."

It was not immediately clear what triggered Sunday's attacks but violence in the region, known as the "Middle Belt", is often characterised as ethno-religious - chiefly Muslim Fulani herdsmen clashing with mainly Christian farmers.

But experts and politicians say climate change and expanding agriculture are creating competition for land, pushing farmers and herders into conflict.

Nomadic cattle herders are from northern Nigeria, which is getting drier and becoming more prone to drought and floods. That is forcing them to trek further south, where farmers are increasing production as the population rapidly expands.

That means less land for nomads and their cattle, supporting the view among local people that the conflict is based on the availability of resources rather than ethnic or religious differences.

"These attacks have been recurring. They want to drive us out of our ancestral land but we will continue to resist these assaults," said Magit Macham, who had returned from the state capital Jos to celebrate Christmas with his family.

Macham was chatting to his brother outside his house when the sputtering sound of a petrol generator was interrupted by gunshots. His brother was hit by a bullet in the leg but Macham dragged him to into the bush where they hid for the night.

"We were taken unawares and those that could run ran into the bush. A good number of those that couldn't were caught and killed with machetes," he said.

Plateau governor called the violence "unprovoked" and police said several houses, cars and motorcycles were burnt.

President Bola Tinubu, who has yet to spell out how he intends to tackle widespread security, described the attacks as "primitive and cruel" and directed police to track down those responsible.

By Hamza Ibrahim and Camillus Eboh, Reuters

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