21:44Nigeria Cracks Down on Bitcoin Trading, Orders Bank Accounts Shuttered
Nigeria has one of the most active peer-to-peer cryptocurrency trading markets in the world, and within the last year has emerged as a true “Bitcoin nation.” But that could soon change.
The Central Bank of Nigeria today issued an open letter to all banks in the country, ordering them to immediately cancel their services to customers who buy, sell, or trade cryptocurrencies.
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The order doesn’t prevent the users of peer-to-peer Bitcoin marketplaces such as Paxful or LocalBitcoins from buying and selling crypto through means other than a bank account, such as gift cards, which remain a popular option.
But forcing traders to stop using bank transactions will likely reduce trading activity considerably, considering it is the most popular option on P2P markets.
The letter sent by the Central Bank of Nigeria.
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It appears that the Central Bank of Nigeria has based itself on these guidelines from the country’s SEC and is now looking to curb crypto activity in Nigeria on the basis of preventing potential securities fraud.
"All DMBs [deposit money banks], NBFIs [non-bank financial institutions] and OFIs [other financial institutions] are directed to identify persons and/or entities transacting in or operating crypto currency exchanges within their systems and ensure that such accounts are closed immediately," the bank’s statement said.
Paxful said Nigerians are paying more attention to Bitcoin because cryptocurrencies offered income-generating opportunities by opening retailers to the global markets. This, the company claims, helped them send and receive money faster and cheaper than traditional methods.
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