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Cryptocurrency Ban: Banks Close Accounts Link to Cryptocurrency Traders in Nigeria

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The Central Bank of Nigeria has given an order to commercial lenders to close the accounts of two individuals and one company. These accounts were ordered to be closed on the suspicion that they were trading cryptocurrencies.

On February 5 2021, the Central Bank issued a circular to commercial banks and other financial institutions, giving a directive that transactions in cryptocurrencies and the facilitation of payment for cryptocurrency exchanges were thereby prohibited.

The CBN went further to instruct financial institutions and banks to identify individuals or other entities that are involved in the exchange of cryptocurrencies or transact in cryptocurrency and close the accounts.

That instruction was followed up by the apex bank in a memo dated November 3 2021. The memo stated clearly that those accounts were in direct violation of the contents of the circular issued on February 5, which was eventually confirmed by the regulator. The instructions in the memo stated that the funds recovered from the closed accounts should be placed in ‘suspense accounts’.

The initial circular issued in February elicited varied reactions from the general public, a good number of which were negative and condemnatory of the CBN’s actions. Many were concerned about the negative implications that the directive would have on the country’s fast-growing cryptocurrency market, and the innovation in Financial Technology.

One very common complaint was that the government was using that directive to crack down on the young Nigerians who had resorted to cryptocurrency trading as a means to leave poverty behind. The CBN was accused of deliberately trying to steal the livelihood of many young Nigerians.

These complaints have now returned on Social Media, following the instructions to close the accounts of the two Nigerians suspected to be trading cryptocurrency.

Many people have accused the governor of the Central Bank of Nigeria, Godwin Emefiele as being unnecessarily harsh on the Nigerians who were probably just chasing a means of livelihood. Following the issuance of the circular in February, Emefiele stated that the cryptocurrency ban was mainly due to the existence of illegal operations (fraud, etc) using cryptocurrency.

Some Nigerians were however unsatisfied with the explanation, convinced that the government did not need to close cryptocurrency to all citizens in order to stop the illegal activities of the relatively few.

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MicroStrategy Adds 7,002 Bitcoin to Portfolio

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Yet again MicroStrategy, an Amereican business intelligence company has purchased an additional 7,002 Bitcoin worth $414.4 million to its digital asset portfolio, summing its total bitcoin asset to $3.57 billion.

The CEO of MicroStrategy, Michael Saylor made the purchase announcement on Monday via a Twitter post.

He tweeted, “MicroStrategy has purchased an additional 7,002 bitcoins for ~$414.4 million in cash at an average price of ~$59,187 per #bitcoin. As of 11/29/21 we #hodl ~121,044 bitcoins acquired for ~$3.57 billion at an average price of ~$29,534 per bitcoin”.

MicroStrategy currently owns 121,044 BTC valued at $3.57 billion that were acquired at an average price of $29,534 per bitcoin.

At the time of writing, data from Kucoin shows that Bitcoin is trading at $56,490 per coin. This implies that Microstrategy’s total bitcoin asset is worth over $6.8 billion.

On Friday, Saylor tweeted, “Bitcoin offers better inflation protection than gold and is growing faster than big tech.” 

Saylor believed that Bitcoin (BTC) “is the only property you can truly own, as well as the first technology capable of granting property rights to everyone on earth and In time, we will come to understand that it is concentrated energy in digital form and critical to the progression of our civilization.”

Despite some countries showing little to no adoption to digital assets, Saylor believed that Bitcoin has a potential to become a $100 trillion asset class. He said “digital gold is going to replace gold this decade.”

The MicroStrategy CEO further said the company is not troubled with the ongoing discussion on crypto regulation, noting that it will affect security tokens, decentralized finance (defi) exchanges, crypto exchanges, and other use cases of cryptocurrency that are not bitcoin. In his opinion, “bitcoin is unstoppable as digital property.”

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Shiba Inu Goes Live on Kraken Exchange

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Another win for Shiba Inu Community, Kraken, one of the world’s leading exchange platforms, has started accepting SHIB trading and deposit, the exchange platform disclosed in a blog post released on its website.

“We’re thrilled to announce that Kraken now supports Shiba Inu (SHIB)! ” the company affirmed.

Investors can now deposit Shib on the platform, according to Kraken. Funding was enabled on Monday while trading will commence on Tuesday.

“Funding is liveand we anticipate trading will begin tomorrow, November 30 — at which point Kraken will enable order entry and execution. Keep an eye on the status page for updates.”

Kraken pegged the minimum deposit per investor at 373,000 SHIB and trading was capped at 50,000 SHIB.

“Deposits require 20 confirmations (~5 minutes). You can add SHIB to your Kraken account by navigating to Funding, selecting the asset, and hitting Deposit. The minimum deposit is 373,000 SHIB. 

“SHIB will be tradeable against USD and EUR, with a trading minimum of 50,000 SHIB, a price precision of 8 decimal places and a quantity precision of 5 decimal places.”

This new support for Shiba Inu on Kraken Exchange is another positive signal for Shiba Inu and it’s community.

The Shiba Community is now waiting for Robinhood to follow Kraken and list Shiba Inu on its crypto trading platform.

At press time Shiba Inu is trading at $0.00004885, 23 Percent up in the last 24 trading hours.

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ASIC Chairman Alludes to Holes in Digital Assets Custody Solutions

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Australian Securities & Investments Commission (ASIC) Chairman Joe Longo, speaking at the AFR’s Super & Wealth Summit, made news Monday when he noted that crypto “investors are on their own.” The rest of his quote speaks to the country’s regulatory situation, saying that “ASIC has already provided some guidance on exchange-traded funds linked to crypto-assets — they at least are financial products, and traded on a licensed exchange, so there will be some protections there. But for the most part, for now at least, investors are on their own.” In combination with other parts of his speech, many wondered if it was a critique of the industry’s custody solutions.

“Mr. Longo walks an interesting tight rope, acknowledging the current regulatory components associated with exchange-traded funds linked to digital assets, while other officials speak of the power of blockchain technology. But then he juxtaposes that with the innate risk which investors are taking when dealing directly with crypto. It is an interesting position, but not one which is surprising, given the current state of custody solutions,” said Richard Gardner, CEO of Modulus, a US-based developer of ultra-high-performance trading and surveillance technology that powers global equities, derivatives, and digital asset exchanges.

“While investors are protected in Australia when buying defined ‘financial products,’ many digital assets are not considered a ‘financial product’ and, thus, investors are not protected in the event of malfeasance. At the same time, Australian Financial Services Minister Jane Hume noted that digital assets weren’t a ‘fad’ and that citizens shouldn’t be ‘fearful of the unknown.’ Taken together, those can be complex messages to parse,” said Gardner.

Longo’s comments, in part, included the following:

“ASIC is [not] here to eliminate risk… But where industry has neglected to take its share of responsibility, ASIC will not hesitate to deploy the powers in our regulatory toolkit – to deter misconduct that causes harm, hold to account individuals and corporations that treat their responsibilities as optional, and drive a culture of better corporate behaviour… By enforcing the law against those who break the rules, we support those who want to do the right thing.”

“From the commentary, we can assume that the ASIC is looking at ways to create compliance measures while not indemnifying investors when exchanges falter. Therein lies the industry opportunity. Custody providers are supposed to fill that role, safeguarding assets in between the time that an investor purchases and is ready to sell. However, custody providers, as well as exchanges’ appropriate use of such providers, have turned out to be woefully inadequate. The market yearns for a secure solution which allows investors to purchase digital assets with confidence. Better custody solutions, used appropriately, would significantly reduce the number of headlines made by hackers,” noted Gardner.

Modulus is known throughout the financial technology segment as a leader in the development of ultra-high frequency trading systems and blockchain technologies. Modulus has provided its exchange solution to some of the industry’s most profitable digital asset exchanges, including a well-known multi-billion-dollar cryptocurrency exchange. Over the past twenty years, the company has built technology for the world’s most notable institutions, with a client list which includes NASA, NASDAQ, Goldman Sachs, Merrill Lynch, JP Morgan Chase, Bank of America, Barclays, Siemens, Shell, Yahoo!, Microsoft, Cornell University, and the University of Chicago.

“Assets sitting in exchange accounts aren’t nearly as secure as assets sitting in cold storage. Custody solutions should be developed with institutional-grade security features, making hacks and other attacks impossible. However, a quick Google search of current top providers will show that they are riddled with security flaws. That’s not custody that investors can believe in. There must be a consequential shift in custody for crypto to flourish to its fullest potential,” opined Gardner.

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