Nigerian Central Bank Calls for Bitcoin Regulation to Stop Money Laundering

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Nigerian Central Bank Calls for Bitcoin Regulation to Stop Money Laundering

Though Bitcoin has often been blamed for being used for money laundering by the central banks and regulatory authorities, it appears, Nigeria’s Central Bank has taken it to the next level as it has called for Bitcoin regulation. The central bank of the country believes Bitcoin regulation will stop money laundering and avoid international penalties.

The indication regarding the call for regulation came to public when Dr Okwu Nnanna, deputy governor of financial system stability at Nigeria’s Central Bank (CBN) who was speaking at the second Anti Money Laundering/Combating Financial Terrorism Stakeholders Consultative Workshop held in Abuja, the country’s capital, said that virtual currency was dangerous.

Dr Okwu Nnanna believes that Bitcoin was not a legal tender of any country hence it has a borderless nature without jurisdiction which makes it a channel for money laundering.

Some Form of Regulation Necessary

Dr Okwu Nnanna says that increased interest in/and use of virtual currencies for both payment transactions and investment purposes, the volatility in the market for virtual currencies and the need to protect market participants against unauthorized access to electronic systems and accounts, were some reasons why virtual currency exchanges should be subjected to some form of regulation.

What he says is not new, this has become a ceremonial for any government regulatory body or central banking agency to claim Bitcoin is being used for money laundering as if the fiats are not being used for the purpose. These agencies and regulators seem failing to acknowledge the role Bitcoin is playing to serve the unbanked population.

Looks like the Work of a Lobby

His views in the workshop titled, “Money Laundering/Terrorism Financing Risk from Virtual Currency and Non-Profit Organizations’ that was organized by chief compliance officers of banks in Nigeria and DataPro Limited, are expected to attract criticism from the cryptocurrency companies as these have been trying hard to reach to the unbanked masses.

Nnanna was quoted saying that the development has made regulations around the world to grapple with how best to regulate such currencies for the protection of the customers and investors, to maintain the stability and satiety of the financial system, and deter the use of virtual currency systems in money laundering and terrorist financing.

He is of the belief that the workshops like this will further assist in laying a solid foundation for the much needed regulatory climate on the operations of virtual currency in Nigeria.

To contact the reporter of this story: Deepak Tiwari at deepak@forexminute.com