Osinbajo speaks on CBN’s ban of Cryptocurrency

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In a veiled rebuke of a recent Central Bank of Nigeria’s (CBN) policy, Vice President Yemi Osinbajo, says cryptocurrencies hold a major stake in banking industry in the not too distant future.

Osinbajo said Nigeria should not act in fear in handling the issue of crypto but apply knowledge to curtail its adverse effect.

Recall CBN had in a few weeks ago ordered banks and other financial institutions to close customer accounts used in trading cryptocurrencies and other related transactions.

The Nigerian bank regulator also directed deposit money banks, non-bank financial institutions and other financial institutions to “identify persons and/or entities transacting in or operating cryptocurrency exchanges within their systems and ensure that such accounts are closed immediately.”

But Osinbajo, who chairs the National Economic Council (NEC) that advises President Muhammadu Buhari on economic affairs in the country, said Nigeria needs to prepare for the cryptocurrencies challenge.

“Cryptocurrencies in the coming years will challenge traditional banking, including reserve banking, in ways that we cannot yet imagine, so we need to be prepared for that seismic shift,” the Vice President tweeted on his verified Twitter’s handle on Friday.

Osinbajo, who also shared a short footage of his thoughts on cryptocurrencies, said regulatory measures are also needed to ensure cryptocurrencies are not exploited by criminals.

“Some of the exciting developments we see call for prudence and care in adopting them and this has been articulated by our regulatory authority, we must act with knowledge but not with fear, we must ensure that we are in a position to be very effective and prevent any of the adverse side affect or criminals that may arise as consequence of adopting or taking any of these options,” he said.

The ban on cryptocurrencies by CBN has of recent time generated a huge debate in the country, with many describing the action as a wrong step in a wrong direction.

CBN has long taken a hardline position against cryptocurrencies, which have become a major unit of commerce across the world in recent years.

In October last year, at the height of the #ENDSARS protests, the bank restricted some financial institutions from receiving or making crypto payments.

The restricted accounts belonged to predominantly young Nigerians who had either sent or received funds to run the #EndSARS protests. When the major fundraisers, Feminist Coalition, were blocked, a bitcoin wallet was set up which donors used to pour in support from across the world.