Regulation Urgently Needed in Nigeria to Combat Crypto Misuse and Safeguard Interests

Regulation Urgently Needed in Nigeria to Combat Crypto Misuse and Safeguard Interests

Nigeria: The Importance of Crypto Regulation in Preventing Financial Crimes

There is a growing call for crypto regulation in Nigeria to combat financial crimes, including money laundering. Adedeji Owonibi, co-founder of A&D Forensics, emphasizes that the lack of regulation in the country allows unchecked practices to thrive. Speaking at a training course organized by Blockchain & Digital Forensic, Owonibi argues that without laws and regulations, there can be no accountability for criminal activities involving cryptocurrencies.

“Nigeria should fully regulate crypto-assets within the country and establish laws for this purpose because without law, there is no crime.”

The recent revocation of the ban on crypto transactions by the Central Bank of Nigeria (CBN) has allowed banks to manage accounts for Virtual Assets Service Providers (VASPs). However, Owonibi warns that without proper control, banks can unwittingly facilitate money laundering and other criminal activities.

“Financial institutions, such as banks, need to ensure that the VASPs they open accounts for are compliant exchanges and not gateways for illegal activities. They must hire compliance officers to report any suspicious transactions.”

Owonibi Calls for Government Action on Crypto Regulation

Owonibi believes that the Nigerian government needs to take further steps in terms of crypto regulation. As an expert in training, he also emphasizes the importance of training security officials to combat financial crimes. Owonibi has already trained law enforcement agents in his courses and collaborates with the Nigerian Financial Intelligence Unit. However, he insists that it is ultimately the responsibility of the government to create and implement clear regulations on cryptocurrencies.

CBN Guidelines for Banks Opening Crypto Accounts

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The CBN recently published guidelines for banks opening crypto accounts, aligning with the recommendations of the FATF. These guidelines only apply to customer accounts, as the ban on banks holding or trading cryptocurrencies on their own behalf remains in force. Customers can conduct crypto-related transactions but cannot withdraw cash. VASPs are required to provide information about their relationship with banks to ensure transparency and accountability.

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