The Central Bank of Nigeria ordered all commercial banks in the country to freeze two crypto accounts

According to Nigerian news outlet Peoples Gazettengr, the Central Bank of Nigeria (CBN) ordered all Nigerian commercial banks to freeze the accounts of certain individuals for purportedly trading in cryptocurrency.

Nigeria central bank reportedly freezes crypto traders’ accounts

The listed accounts belong to two individuals, Nnamdi Francis Okereke and Nwaorgu Kingsley Chibuzor, and TVS Hallmark Service Limited.

Accordingly, Director of Banking Supervision, JY Mammanand, has issued a notice directing the central bank to close the accounts of two alleged crypto traders and transfer their funds in suspense accounts. Mammanand cited the CBN circular issued in February as the basis for the account closure. This is contained in a Post-No-Debit circular signed on November 3 by the Director of Banking Supervision, J. Y. Mammanand addressed to the banks.

“You are hereby directed to close accounts of the under-listed bank customers and place the funds in the accounts in suspense accounts for engaging in cryptocurrency trading in contravention of CBN Circular BSD/DIR/PUB/014/001 dated February 5, 2021.”

The crackdown is believed to be part of a more significant move by bank regulators to immediately close the accounts of Nigerian residents or companies that transact in or operate cryptocurrency exchanges using local banks.

In February, the apex bank ordered banks and other financial institutions to close all customer accounts used in trading cryptocurrencies and other related transactions. CBN Governor Godwin Emefiel later stated that most cryptocurrency transactions through commercial banks in the country are illegitimate, used to finance illicit activities.

Despite the central bank’s actions, Nigeria’s crypto market has emerged as one of the largest in Africa, with the continent’s overall retail trading volume growing by more than 1,200 % from July 2020 to June 2021.

Additionally, CBN is preparing to introduce the country’s central bank digital currency, eNaira, following approval by the Federal Supreme Court of Nigeria in October. ENaira is being marketed as a faster, cheaper, and more secure option for monetary transactions but is expected to circulate alongside Nigeria’s fiat currency.

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