GOVERNOR of the Central Bank of Nigeria (CBN), Olayemi Cardoso, has announced that the bank is working with the Securities and Exchange Commission (SEC) to create a sustainable framework for digital currencies in the country.
Speaking at the CBN governor’s annual lecture series at Lagos Business School (LBS) on Friday, October 3, Cardoso noted that cryptocurrencies, fintech, and blockchain innovations will influence the future of currency policy, though the extent of their impact is still uncertain.
“We are deeply in collaboration to ensure that all the different regulatory authorities can midwife the process that is sustainable with respect to digital currency.”
He recalled that Nigeria gained global attention in the crypto space two years ago when regulators faced challenges in controlling coin exchange markets, placing the country among the world’s largest hubs for crypto trading.
“Suddenly, over a period of time, coin exchange became very difficult to protect. Many people, not just youngsters, turned to crypto, and a whole architecture started to evolve,” he said.
The ICIR reported that the apex bank issued a directive in February 2021, instructing banks and other financial institutions to close accounts of individuals engaged in cryptocurrency transactions.
According to the CBN, this directive was prompted by the inherent risks of money laundering and terrorism financing (ML/TF), vulnerabilities inherent in their operations, and the absence of regulations and consumer protection measures.
However, it lifted the ban on cryptocurrency transactions in the country in December 2023, issuing a guideline to financial institutions under its regulatory purview regarding their banking relationship with Virtual Assets Service Providers (VASPs) in Nigeria.
Cardoso, in his latest remark, stressed that steady policies and ongoing reforms have helped rebuild confidence in Nigeria’s economy, sparking renewed interest from global investors.
“In many respects, regulators left it alone, and people believed that perhaps it didn’t exist until certain things happened. It became clearer that there was a need to understand the market better,” the CBN governor added.
The governor urged students aspiring to become future leaders to protect their integrity, remain steadfast in the face of challenges, and develop strong communication skills, particularly when dealing with complex issues such as monetary policy.
“The danger in not communicating is that only you know what you are doing. People need to understand the journey, the challenges, and the hope for the future,” he said.
On innovation, Cardoso noted that the apex bank has already adopted digitisation and artificial intelligence (AI) in its operations, with all approval processes fully digitised and a pledge to maintain a paperless office.
Nanji is an investigative journalist with the ICIR. She has years of experience in reporting and broadcasting human angle stories, gender inequalities, minority stories, and human rights issues. She has documented sexual war crimes in armed conflict, sex for grades in Nigerian Universities, harmful traditional practices and human trafficking.