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The Central Bank of Nigeria on February 5 asked all banks in the country to immediately cancel their services for companies and Nigerians who buy, sell or trade in cryptocurrencies.
Nigeria is considered the second country in the world in terms of peer-to-peer BTC transactions. According to Coin Dance data, Nigeria has traded 60,215 BTCs in the last five years, worth over $566 million, a figure that only the United States has surpassed.
The ban was unveiled in a circular issued by the country’s central bank. According to the institution, the decision is merely an extension of previous warnings about the risks associated with cryptocurrencies. The Nigerian central bank also warned of severe sanctions against any bank or financial institution that does not comply with the directive.
The local branch of Binance has already decided to suspend deposits for Nigerians. Thus, users can no longer convert naira, the country’s local currency, into cryptocurrencies.
The directive comes just a few months after cryptocurrencies entered the national consciousness during protests against police violence in October 2020. At the time, the central bank ordered the suspension of bank accounts of supporters of the EndSARS movement. That’s when the movement’s supporters started sending donations in cryptocurrencies.
The embargo on cryptocurrency exchange platforms by the Buhari administration triggered an outcry among Nigerians. Since the new directive started circulating on the Internet, cryptocurrencies holders have launched the hashtag #WeWantOurCryptoBack which has been relayed more than 30,000 times.
However, Nigerians may find alternatives to continue buying cryptocurrencies. Tosin Olugbenga, a blockchain engineer based in Nigeria, explained that most transactions and purchases of cryptocurrencies in Nigeria are done on P2P exchanges and that these new restrictions will have little impact.