CBN Crypto Ban: How FBI Warned of fraudulent Funds Wired to Nigeria via Crypto transactions

A cryptocurrency (or crypto) is a digital unregulated currency that could be used to buy goods and services, but uses an online ledger with strong cryptography to secure online transactions.CBN orders banks to close cryptocurrency accounts

The ban on crypto related trading by the Central Bank of Nigeria may be related to warnings sent to the government by the United States’ Federal Bureau of Investigation (FBI) of an alarming rate of funds wired weekly to Nigeria from the west using cryptocurrencies, an investigations by Thisday Newspapers suggests.

The apex bank banned dealings in cryptocurrencies or facilitating payments for cryptocurrency exchanges in Nigeria last week Friday leading to an reactions by crypto users and stakeholders across the country.

Between $200m to $300m were allegedly wired to Nigeria weekly in suspected fraudulent transactions, leading the FBI to warn the Nigerian government. The funds were alleged to be proceeds of fraud particularly targeting the COVID-19 stimulus packages designed to cushion the impact of lockdown measures on businesses and working families in the US and other western countries.

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A cryptocurrency (or crypto) is a digital unregulated currency that could be used to buy goods and services, but uses an online ledger with strong cryptography to secure online transactions using block chain technology.

A cryptocurrency (or crypto) is a digital unregulated currency that could be used to buy goods and services, but uses an online ledger with strong cryptography to secure online transactions.
bitcoin

In an interview at a Reuters online event last week Wednesday, President of the European Central Bank, Christine Lagarde said of bitcoin: “It’s a highly speculative asset that has led to some reprehensible activity, including money laundering, and any loopholes need to be closed.

“There has to be regulation. This has to be applied and agreed upon at a global level because if there is an escape that escape will be used; she said.

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According to the investigation, “FBI had discovered that fraudulent Nigerians, popularly known as yahoo boys, took control of large chunks of money released as stimulus in the wake of the devastating effects of the COVID-19, which has put many Americans out of jobs.”

Crypto became the channel of choice for the fraudsters to divert these funds in order to avert detection by both the FBI and the Nigerian authorities.

In the past months, Nigeria has been repeatedly named the second country in the world with the biggest cryptocurrency transactions.

After the FBI tip-off that these funds being pumped into cryptocurrencies were products of fraud, the federal government, acting through the CBN, had to ban cryptocurrencies in Nigeria.

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A cryptocurrency (or crypto) is a digital unregulated currency that could be used to buy goods and services, but uses an online ledger with strong cryptography to secure online transactions based on block chain technology.

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