In an attempt to curb illicit financial transactions in the country, the Central Bank of Nigeria, on 5 February 2021, issued a directive prohibiting the trading of cryptocurrencies.
This directive referenced a January 2017 circular sent out to the country’s financial institutions cautioning them on the risks associated with cryptocurrency transactions. The CBN stated that these virtual currencies are unacceptable as a legal tender in Nigeria and pose money laundering, and terrorist financing risks. Consequently, the CBN has now instructed financial institutions to identify persons trading in cryptocurrency and ensure that accounts of such persons are blocked immediately.
According to this report, Nigeria has been the highest market for cryptocurrency trading in Africa for two years running, followed by South Africa in second place. Many young people in Nigeria trade in cryptocurrency at some level or another. It is unclear how this ban will affect Nigeria’s economy, despite the Central Bank’s claim that the ban will stabilize its currency against the dollar.
See here for the CBN directive prohibiting cryptocurrency trading in the country.