By Haruna Salami
The Central Bank of Nigeria, CBN on Tuesday said its directive to banks to discontinue transactions on crypto currency was to protect Nigerians involved in transparent bank transactions.
CBN Governor, Mr. Godwin Emefiele said this at an interactive session with members of Senate Joint Committees on Banking, Capital Market and ICT.
Senate had on Feb.11 at plenary mandated its joint committees to invite the CBN Governor, and Director General of Security and Exchange Commission, SEC to brief the committee on circumstances leading to ban on cryptocurrency transactions.
Emefiele in his presentation said the decision “is in the best interest of every well-meaning Nigerian, who has noting to hide and is happy to have traceble and transparent dealings in our financial system.
According to him “cryptocurrency was a currency issued by largely unknown, unregulated elements using computer that are basically encrypted .
“Transactions on cryptocurrency was designed to hide information about the transactions and the operators,adding the cruptocurrency model was created out of a thin air.
“Cryptocurrency is used to describe the activities of traders in an electronic dark world where transactions are extremely opaque, not visible and not transparent.
“These are people who deal in transactions that do not want to be trailed.
“The definitions of cryptocurrency was scary enough to scare anxiety for any regulator or Central Banker in any part of the world and that is the reason, virtually all regulators in the world did not recognise it.”
“The CBN has been studying the development and paying close attention to currencies in that space, since many Nigerians delved into its usage .
He said the CBN knows that a continuation of the transaction significantly threatens the safety and soundness of the nation’s collection system .
“CBN has a major and primary responsibility as a primary regulator to protect activities of actors, bank stakeholders and uninformed actors in the financial system from other actors who may wish to take advantage of their lack or limited knowledge to rip off the uninformed.
“And that is the reason we have banned all banks to desist from operating accounts for cryptocurrency dealers in Nigeria.
“We have also asked our banking supervision and payment system and our IT department to conduct investigation into the activities of forex exchanges and their major players.
“The result of the investigation will lead to better understanding of their activities and will be unvailed to all.”
According to him, crypto currency has been used to facilitate scam,money laundering, and payment of ramson for kidnapping, finance for terror in different parts of the world.
“Our business is to protect,to inform and ensure that those who seek protection in a regulated environment receive the protection,”he said.
He said a significant number of Central Banks around the world have taken the same position like CBN and therefore appealed to Nigerians to be patient with understanding as the CBN was monitoring the space .
Earlier, Chairman of the Joint Committee,Sen .Uba Sani, (Kaduna central), who is also Chairman, Senate Committee on Banking said the interactive session was a fact finding mission by the joint commitee on the position of CBN on cryptocurrency ban.
Sani said the senate would support any legitimate drive of Nigerians and decision designed to promote the economy.
Other stakeholders who made short remarks on the CBN’s ban of Cryptocurrency transactions includes the Director General, Security and Exchange Commission, SEC, Lamido Yuguda and Chairman, Independent Corrupt Practices and Other related offences Commission, ICPC Prof.Bolaji Owasanoye, among others.