In a circular dated December 22, 2023, Nigeria’s apex bank, the Central Bank of Nigeria (CBN) has unbanned crypto transactions in banks operating in the West African country, prompting the Pan-African trading firm, Yellow Card Exchange to seek Nigerian licensing.
The circular titled ‘Circular to all Banks and other Financial Institutions Guidelines on Operations of Bank Accounts for Virtual Assets Service Providers (VASPS),’ said that current trends globally have shown the need for crypto regulation.
It said, “The CBN, in February 2021 issued a circular restricting banks and other financial institutions from operating accounts for cryptocurrency service providers in view of the money laundering and terrorism financing (ML/TF) risks and vulnerabilities inherent in their operations as well as the absence of regulations and consumer protection measures.
“However, current trends globally have shown that there is a need to regulate the activities of virtual assets service providers (VASPs) which include cryptocurrencies and crypto assets. Following this development, the Financial Action Task Force (FATF) in 2018 also updated its Recommendation 15 to require VASPS to be regulated to prevent misuse of virtual assets for ML/TF/PF.
“Furthermore, Section 30 of the Money Laundering (Prevention and Prohibition) Act, 2022 recognises VASPs as part of the definition of a financial institution.
Yellow Card Exchange is exploring avenues to leverage the first-mover advantage with the pursuit of licensing.
