Nigeria’s Central Bank Lifts Cryptocurrency Ban Amid Growing Global Market

Nigeria’s Central Bank recently lifted a ban on cryptocurrency transactions, reversing a policy instituted in 2021 over concerns about money laundering and terrorism financing risks. The move comes as the global cryptocurrency market capitalization exceeds $1 trillion.

The decision, outlined in a recent circular, allows for the opening of accounts designated for virtual/digital assets, but banks are still prohibited from trading, holding, or transacting cryptocurrencies. Despite this development, the World Federation of Exchanges (WFE) advocates for stricter regulations for Crypto-Asset Trading Platforms (CTPs) to address market failures.

The WFE’s latest report emphasizes the need for CTPs to adhere to the same principles as regulated exchanges, promoting a technology-neutral approach to regulation. The call for comprehensive regulations aligns with the challenges faced by certain crypto trading platforms, including poor governance, management inexperience, lack of proper systems and controls, conflicts of interest, and potential fraud.

As the Securities and Exchange Commission in Nigeria explores regulations for digital assets, the global cryptocurrency landscape continues to evolve. The lifting of Nigeria’s crypto ban reflects a broader trend of regulatory shifts in the crypto space worldwide.