Central Bank of Nigeria To Freeze Bank Accounts Linked With Binance, Bybit, KuCoin

The Central Bank of Nigeria (CBN) has issued a new directive requiring all banks and financial institutions in the country to identify individuals or entities engaging in transactions with cryptocurrency exchanges.

The circular also requires the bank to place their accounts under a Post No Debit (PND) instruction for a period of six months.  

Key points:

• The CBN has listed Bybit, KuCoin, OKX, and Binance as crypto exchanges not licensed for operations in Nigeria.
• The bank has stated that it will catch anyone buying and selling Tether on the listed platforms illegally, especially those using peer-to-peer (P2P) methods.
• Regulated financial institutions engaged in crypto or facilitating payments for crypto exchanges are prohibited.
• The CBN’s focus on crypto platforms comes amid the swift devaluation of the naira and a high inflation rate of 29.9%.

A PND instruction is a directive issued by a bank or financial institution that restricts certain transactions on a customer’s account. A PND instruction prohibits the account holder from making debit transactions.

Also read: Binance Founder Changpeng Zhao Should Face 3-Year Prison Sentence: DOJ

Central Bank of Nigeria’s (CBN) decision comes as a surprise

The CBN’s decision to target unlicensed crypto exchanges comes as a surprise. This is because the bank lifted a comprehensive ban on banks engaging with digital currencies in December 2023.  

The recent devaluation of the naira and the subsequent inflation rate of 29.9% appear to have prompted the government to shift its attention to platforms offering cryptocurrency services. The CBN has even blocked websites associated with crypto trading.

Also checkout: Crypto Industry Groups Sue SEC Over Expanded ‘Dealer’ Definition

Binance is also facing ongoing scrutiny from the Nigerian government. The CBN’s latest directive has raised questions about the future of cryptocurrency in Nigeria.