CBN to Regulate Cryptocurrency Transactions With New Policy

The Central Bank of Nigeria (CBN) has disclosed plans to enact a regulatory policy framework on cryptocurrency transactions in the country.

Investors King recalls that the apex bank had earlier halted crypto payments in the banking system insisting that digital currency was used for money laundering and terrorism.

In its report on Nigeria’s payments system vision 2025, the CBN stated that it would partner with the Security Exchange Commission to develop a regulatory framework for the implementation of an ICO-based investment solution.

“The CBN would consider the development of a regulatory framework for potential implementation of ‘Stablecoins.’ It would also continue its watching brief on Initial Coin Offerings,” it said.

Investors King reports that finance analysts have expressed worry over the use of stablecoins which was described as untimely since the e-naira policy failed.

Stablecoins refer to cryptocurrencies whose value are attached to another currency or commodity to serve as an alternative to the high volatility of popular cryptocurrencies like Bitcoin, thereby making crypto investments less suitable for usual transactions.

On his part, an economist, Rotimi Fakayejo stressed that the policy will not have the desired effect on the economy as the timing is not right.

He added that currently the naira is not stable as well as foreign exchange, a reason why such a policy should not be adopted.

“We have tried e-naira and it is not working. I do not think CBN is thinking right. We all know how weak regulations can be in this country,” Fakayejo said.

However, the Acting Director, Corporate Communications, CBN, Osita Nwanisobi has said that the policy will not have any negative impact on fintechs.

He pointed out that in Nigeria, the use of cryptocurrencies is a direct contravention of the laws of the land.

“It is also important to highlight that there is a critical difference between a central bank-issued digital currency and cryptocurrencies. As the names imply, while central banks can issue digital currencies, cryptocurrencies are issued by unknown and unregulated entities,” Nwanisobi explained.