On February 5, 2021, the Central Bank of Nigeria (CBN) released a circular addressed to banks and other financial institutions with the directive that transactions in cryptocurrencies and facilitating payment for cryptocurrency exchanges were prohibited.

This elicited a lot of negative reactions from Nigeria’s youths because it doesn’t make sense that a country battling insecurity and unemployment will shut down a market said to be worth as much as $400m.

According to Nairametrics, the lion’s share of peer-to-peer transactions in Africa still belongs to Nigeria. Nigeria currently has a P2P volume of $400 million on two major platforms.

CBN’s rationale for the Crypto ban:
CBN explained that cryptocurrencies transaction was devoid of proper regulation and prone to financial crimes largely due to their anonymity.

It was feared that kidnappers will demand that the ransoms of their kidnap victims are paid via Crypto. They also feared that Crypto will aid financial crimes like money laundering.

One year later…
One year later kidnapping is even more lucrative than it was before the ban but I am yet to hear of a kidnapper that sent a wallet address instead of the old but effective “drop the money at… and make sure you don’t involve the police.”

A directive even the state governments and FG have reportedly obeyed. Meanwhile, Deji Adenyanju is still petitioning the EFCC to investigate Tinubu’s bullion van scandal but let’s turn a blind eye to the real issues and blame vices like kidnap and money laundering on the anonymity of Cryptocurrencies.

The price
What the CBN has achieved with its continued ban on Cryptocurrency is that a $400m market has been pushed to the black market making it easier for young Nigerians who are trying to get by to become sitting ducks to exploiters, big platforms like Binance and Coinbase are not excluded as there are reports of young Nigerians whose accounts have been frozen without any violations.

While every other financial institution is looking for ways to take advantage of a 2 trillion dollar Cryptocurrency market and countries like El Salvador putting themselves in a pole position to benefit from Cryptocurrency, Emefiele led CBN chose to ignore, and even worse, place a ban on a TWO TRILLION DOLLAR MARKET!

I guess we can’t expect any better from a man that recently filed a lawsuit seeking to run for president without resigning as CBN governor.