Bank of Nigeria (CBN) released a circular that barred deposit money banks and all other financial institutions from the operation of any form of virtual currency. The circular was signed the CBN Director of Financial Policy and Regulation Department, Mr. Kevin Amugo.
Virtual currencies (VCs) such as bitcoin, ripples, magneto, litecoin, dogecoin, peercoin, one-line, and others, have not been recognised as legal tender in Nigeria but which are already being traded in exchange platforms that are unregulated all over the world.
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The circular stated in part: “The attention of banks and other financial institutions is hereby drawn to the above risks and you are required to take the following actions pending substantive regulation decision by the CBN.
“Ensure that you do not use, hold, trade, and/ or transact in anyway in virtual currencies; Ensure that existing customers, that are virtual customers exchangers, have effective AML/CFT controls that enables them to comply with customers’ identification, verification and transaction monitoring requirements.”
Others directives include: “Where banks or financial institutions are not satisfied with controls put in place by the virtual currency exchangers/customers the relationship should be discontinued immediately, and lastly, Any suspicious transactions by these customers should immediately be reported to the Nigerian Financial Intelligence Unit (NFIU).”