The Central Bank of Nigeria has introduced new guidelines imposing restrictions on cryptocurrency transactions.
These guidelines, posted on the CBN’s website, specifically outline the operational framework for cryptocurrency accounts, termed Virtual Assets Service Providers.
According to the guidelines, cryptocurrency accounts are solely designated for virtual/digital assets and are prohibited from being used for any other purposes.
Notably, the CBN explicitly prohibits cash withdrawals from these accounts and the clearance of third-party cheques.
The guidelines state, “An account opened by these Guidelines shall only be used for transactions on virtual/digital assets and not for any other purpose.
No cash withdrawal shall be allowed from the account. No third-party cheque shall be cleared.”
Additionally, the document specifies that withdrawals from cryptocurrency accounts, except for settling virtual/digital assets transactions, can only be executed through a manager’s cheque or transfer to another designated account.
Highlighting the global trend in regulating virtual asset service providers, the CBN emphasized the necessity for oversight in these guidelines.
It mentions, “Current trends globally have shown a need to regulate the activities of virtual asset service providers, which include cryptocurrencies and crypto assets.”
This decision by the CBN follows the lifting of the cryptocurrency ban in December 2023 and positions Nigeria alongside other African countries like South Africa and Botswana in implementing regulatory measures to mitigate potential fraud risks associated with the cryptocurrency market.
