The Governor of the Central Bank of Nigeria (CBN), Godwin Emefiele, has defended Apex Bank’s decision to exclude cryptocurrency transactions from the banking ecosystem. In his testimony before the Nigerian Senate, Emefiele claimed that the February 5 directive was “in the best interests of Nigerians.”
Crypto not money
Immediately after the CBN ban was announced, Nigeria’s regulated financial institutions began severing relationships with crypto traders and exchanges. After an outcry over the move, some supportive members of the Nigerian Senate Committee on Banking, Insurance and Other Financial Institutions urged Emefiele to inform the legislature of the reasons for the CBN ban.
To justify the move of the CBN governor told the Nigerian legislature that “cryptocurrency is not legitimate money” as it is not issued by any central bank. With this argument, Emefiele then added:
Cryptocurrency currently has no place in our monetary system, and cryptocurrency transactions should not be processed through the Nigerian banking system.
As expected, the CBN governor also used his appearance before the legislature to reproduce the usual claims against cryptocurrencies. In an effort to step up the case against cryptocurrencies, a report also reveals that Emefiele passed on “cases of investigated criminal activity linked to cryptocurrencies.” However, the report does not provide details on some of the “cases investigated”.
No contradictions between CBN and the SEC
However, regardless of the CBN’s tough stance on cryptocurrencies, Emefiele still claims that the central bank’s actions “have in no way, form, or form been detrimental to the development of fintech or a technology-driven payment system.” The CBN chief also reiterated that the central bank “will do everything within its regulatory powers to educate Nigerians about emerging financial risks.”
Meanwhile, Lamido Yuguda, director general of the Nigerian Securities and Exchange Commission (SEC), denied in comments made during the same meeting that there had been political inconsistencies between the two regulators. Quoting Yuguda, the report confirms that the SEC “has postponed the inclusion of everyone affected by the CBN circular in its proposed framework for incubation.”
Do you agree with CBN’s claims that excluding cryptocurrency transactions protects the banking ecosystem? Let us know what you think in the comments section below.
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