Nigeria Fines Four Local Banks for Facilitating Crypto Payments

The Central Bank of Nigeria (CBN) has imposed financial penalties on four commercial banks in the country for facilitating crypto-related transactions, Bloomberg reported on Wednesday.

The sanctioned banks are Access Bank Plc, Stanbic IBTC Bank, United Bank for Africa (UBA), and Fidelity Bank Plc. 

Access Bank was slapped with the highest fine of about $1.2 million followed by Stanbic IBTC with $480,594. UBA and Fidelity fined $240,298 and $34,362 respectively.

Recall that CBN released a circular in February 2021, prohibiting banks from facilitating crypto-related transactions, saying that the asset class poses a threat to the country’s financial system.

Stanbic IBTC CEO Wole Adeniyi said the bank followed CBN rules. However, crypto-related activities took place on its platform unnoticed which the apex bank was able to track using an “advanced capability.” 

“It doesn’t seem that they are going to entertain a refund, but they are now sharing intelligence with us to be able to kind of deter clients,” he added.

Nigeria Leads P2P Trading in Africa Despite Ban

Despite stringent crypto regulation in Nigeria, investors in the country have not stopped investing in cryptocurrencies.

Since banks and other institutions were prohibited from offering crypto services, Nigerians had to turn to P2P platforms. As reported by Coinfomania, the West African nation became the largest crypto peer-to-peer (P2P) market in Africa a few months into the ban.

The country became Paxful’s biggest market seeing significant trading volume worth up to $1.5 billion with more than 1.5 million users at the time.

Nigeria Sets up Fintech Division for Crypto Research

As part of its push to regulate the crypto industry, Nigeria’s Securities and Exchange Commission (SEC Nigeria) created a fintech division  that will focus on researching digital assets in order to come up with regulatory frameworks to protect crypto investors.

Meanwhile, in October, Nigeria launched its Central Bank Digital Currency (CBDC) dubbed eNaira, but crypto enthusiasts in the country were seemingly not impressed by the move.