Nigeria is one of the world’s fastest users of digital assets, and the Central Bank of Nigeria revoked its prohibition on local banks and financial institutions serving cryptocurrency startups. This action is likely to encourage the use of cryptocurrencies in the country.The ruling, which was made public last week, reverses a 2021 rule that forbade organizations from supporting bitcoin transactions.The nation’s central bank was compelled to state at the time that it did not forbid cryptocurrency trading.Nevertheless, customers kept adopting it and moved to peer-to-peer trade.
With prominent companies like pan-African exchange Yellow Card announcing that it will pursue a cryptocurrency license in the nation under regulations approved in May of this year, lifting prohibitions on cryptocurrency exchanges and other service providers obtaining bank accounts could increase usage.
“With the new policy fostering a regulated environment, Yellow Card anticipates a surge in user adoption and engagement in the coming months,” Lasbery Oludimu, the company’s chief data protection officer, told local news outlet Nairametrics on Wednesday. “The clarity provided by the regulatory framework instills trust and confidence among users, attracting more individuals and businesses into the crypto space.”
The international trend toward regulating cryptocurrencies, according to central bank circular reference FPR/DIR/PUB/CIR/002/003, which has not yet been posted on the CBN website, is what spurred the transition.Establishers of global standards such as the International Monetary Fund (IMF) and the Financial Stability Board (FSB) have suggested industry oversight as an alternative to outright prohibitions.The CBN circular was referred to as a “Christmas present” by a Nigerian crypto celebrity on X.