Nigeria's Central Bank Reverses Crypto Ban, Boosting Adoption Prospects

According to CoinDesk, the Central Bank of Nigeria (CBN) has reversed its prohibition on local banks and financial institutions serving crypto firms, a move likely to spur the use of cryptocurrencies in one of the world's fastest adopters of digital assets. The decision, announced last week, rescinds a 2021 directive against institutions facilitating cryptocurrency transactions. Despite the initial directive, adoption continued with users switching to peer-to-peer trading. Lifting restrictions on crypto exchanges and other service providers from opening bank accounts could boost adoption. High-profile players like pan-African exchange Yellow Card have stated they will seek a crypto license in the country under frameworks introduced in May this year. Lasbery Oludimu, Yellow Card's chief data protection officer, told local news outlet Nairametrics that the new policy fosters a regulated environment, anticipating a surge in user adoption and engagement in the coming months. The regulatory framework's clarity instills trust and confidence among users, attracting more individuals and businesses into the crypto space. The central bank circular reference FPR/DIR/PUB/CIR/002/003, yet to be published on the CBN website, states that the global trend of regulating crypto prompted the change. International standard setters like the Financial Stability Board (FSB) and the International Monetary Fund (IMF) have recommended supervision of the industry rather than blanket bans. A Nigerian crypto personality called the CBN circular a 'Christmas present.'