Nigeria's central bank freezes accounts of suspected crypto traders

Nigeria's central bank freezes accounts of suspected crypto traders

The Central Bank of Nigeria (CBN) has directed commercial banks in the country to close accounts connected to two entities accused of trading crypto.

According to a report by Nigerian media outlet Peoples Gazette, the order was contained in a Post-No-Debit Circular issued on November 3.

The circular signed by J. Y. Mammanand, director of banking supervision at the CBN, called for the immediate closure of the accounts belonging to one company TVS Hallmark Service Limited and two individuals, Nwaorgu Kingsley Chibuzor and Nnamdi Francis Okereke.

The CBN memo also instructed that the funds held by the indicted entities should be placed in “suspense accounts.” Several fintech firms have also suffered a similar fate in recent times although that action was due to the companies allegedly offering unlicensed asset management services.

Nigeria’s central bank banned financial institutions from providing services to crypto trading platforms in February. As part of the order, the central bank instructed commercial banks to identify and shut down accounts tied to cryptocurrency trading activities.

The CBN has clarified that cryptocurrency is not banned in Nigeria. According to the central bank, the banking prohibition was to prevent the use of the country’s financial apparatus to support crypto transactions.

Following the ban, peer-to-peer transactions reportedly account for the bulk of the country’s virtual currency trading activity. Cheaper remittance costs and currency devaluation continue to drive crypto adoption in Nigeria despite the CBN ban.

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