Godwin Emefiele, the Governor of the Central Bank of Nigeria (CBN), said that believe it or not but the truth is the majority of digital currency transactions are entrenched with illicitness and criminalities. He also commented that the country’s financial system does not have any space for digital currencies within.
Nigeria is amongst the best countries in the world where crypto adoption is on an extra high level. However, the country’s crypto history is not very flamboyant but rather a perturbed one. At many times in the past, crypto usage has been declared illegal and bans were imposed by the Central Bank of Nigeria (CBN).
But even today, the Nigerian crypto economy is at number two in Africa. Even, CBN had recently launched a Central Bank Digital Currency i.e. e-naira, which is in the testing process. There is therefore a genuine recognition for crypto in Nigeria. However, the recent remarks of CBN’s Governor are not very pleasing for the Nigerian crypto market.
Godwin Emefiele is the Governor of CBN who, in an interview, commented on cryptocurrencies. He commented that the country’s financial system is good enough that it does not need anything else such as cryptocurrencies. He said that crypto inclusion in the financial system is unnecessary and would only create problems.
He stated categorically that the majority of crypto transactions are entrenched with criminalities. They are actively used for illicit purposes and therefore shouldn’t be trusted and put into a system that is trusted worldwide.
He was asked about the decision of CBN in which the bank had instructed financial institutions to close accounts of crypto customers. When asked, he literally denied that any such instructions were ever issued.
Instead, he acknowledged the fact that there were some directives that CBN had asked the banks to follow. However, nowhere in the directives, CBN had suggested that bank accounts of crypto customers be frozen.
But the remarks of the Governor were on to the point because he believed that the 2020 protests in the country were fuelled by crypto. The riots of 2020 are remembered as the “Endsars protest” in the country. CBN and its Governor believe that if banks had closed any bank accounts then the decisions were taken individually by the banks.
It is believed that the riots were committed by the persons whose accounts were closed. The aggrieved persons then resorted to holding protests and took them to the streets. The protestors then launched a Bitcoin fund where funds were received to continue to fuel protests. It was this aspect that the Governor of CBN was referring to.
As retaliation for the protests, CBN then excluded digital currencies from the financial system.
The Governor of CBN still believes that CBN cannot favor crypto becoming part of the Nigerian financial system.