The inconsistencies in CBN's position on Crytocurrencies [A THREAD]

I took some time to review CBN's documents regarding its cryptocurrency decision and not only does it reek of inconsistencies but unfounded lies.

CBN in a press release last week as a response to the public reactions about its Feb 5 circular banning "the facilitation of payments for crypto exchanges" said that "the CBN circular
of February 5, 2021 did not place any new restrictions on cryptocurrencies".

further CBN said "all banks in the country had earlier been forbidden, through CBN’s circular dated January 12, 2017, not to use, hold, trade and/or transact in cryptocurrencies . Indeed, this position was reiterated in another CBN Press Release dated February 27, 2018."

That is a lie! The 2017 circular forbade banks from holding, trading or transacting in cryptocurrencies. However, it gave them the permission to have merchants who are crypto exchanges, provided they meet Anti-Money Laundering and Counter-Terrorism Financing requirements.

These AML/CTF requirements are largely met by most crypto merchants in Nigeria. They usually place a limit on your account until you verify your BVN. Hence, they are able to identify, verify and monitor the transactions of their crypto traders per the circular.

More importantly, 2017 circular did not ban "the facilitation of payments for crypto exchanges". News Flash: 2018 circular did not either. It said "for the avoidance of doubt, we cannot protect crypto dealers and traders by law" (paraphrased). Hence, it was a cautious advice.

Fast forward to 2021, CBN comes with a circular that said "remember our regulative directives on this subject" when in fact 2017 letter clearly said "no substantive regulation or decision yet" and 2018 said "we wish to caution all and sundry".

2021 press release further stated two earlier circulars meaning there was no other circular on this subject beyond 2017 and 2018. So, where did the regulation come from?

References below:

Amugo, K., 2017. [circular] Central Bank of Nigeria. Available at: < https://www.cbn.gov.ng/out/2017/fprd/aml%20january%202017%20circular%20to%20fis%20on%20virtual%20currency.pdf> [Accessed 12 February 2021]

Okorafor, I., 2018. [circular] Central Bank of Nigeria. Available at: < https://www.cbn.gov.ng/out/2018/ccd/press%20release%20on%20virtual%20currencies.pdf> [Accessed 12 February 2021]

Hassan, B. et. al., 2021. [circular] Central Bank of Nigeria. Available at: < https://www.cbn.gov.ng/Out/2021/CCD/Letter%20on%20Crypto.pdf> [Accessed 12 February 2021]

Nwanisobi, O., 2021. [press release] Central Bank of Nigeria. Available at: < https://www.cbn.gov.ng/Out/2021/CCD/CBN%20Press%20Release%20Crypto%2007022021.pdf> [Accessed 12 February 2021]