CBN warns Nigerians: Stay away from bitcoin… it isn’t legal tender

The Central Bank of Nigeria (CBN) has warned Nigerians against the use of virtual currencies, including bitcoin, ripples, litecoin.

In a statement on Tuesday, CBN said virtual currencies are largely used in terrorism financing and money laundering, considering the anonymity of virtual transactions.

“The attention of bank and other financial institutions is hereby drawn to the above risks and you are required to take the following actions actions pending substantive regulation or decision by the CBN,” the statement read.

“Ensure that you do not use, hold, trade and/or transact in any way in virtual currencies. Ensure that existing customers that are virtual currency exchangers have effective capital AML/CFT controls that enable them to comply with customer identification, verification and transfer, monitoring requirements.

“Where banks or other financial institutions are not satisfied with the controls put in place by the virtual currency exchanger/customers, the relationship should be discontinued immediately.

“Any suspicious transactions by these customers should immediately be reported to the Nigerian Finance Intellignece Unit (NFIU).”

The apex bank said anyone trading in bitcoin is doing so at his or her own risk.

“The CBN reiterates that VCs such as bitcoin, ripples, monero, litecoin, dogecion, onecoin, etc., and similar products are not legal tenders in Nigeria.

“Thus, any bank or institution that transacts in such businesses does so at its own risk.”

Bitcoin was the best performing currency of the year 2016. It has appreciated from four cents in 2010 to over $1,000 in 2017.

On January 8, when MMM Nigeria announced its planned comeback, it introduced bitcoin as a mode of payment.

Prior to the freeze of MMM, participants were allowed to provide help in bitcoin, but they were paid back in naira. However, the new plan allows participants to receive payment in bitcoin, and watch their monies grow in bitcoin.

“Due to the recent sharp price fluctuations of Bitcoin, MAVRO-BTC is being introduced in the system,” MMM said.

“So far, we have only had Mavro-Naira in the System. Even though you provided help via Bitcoin, your Bitcoins, anyway, were recalculated into the Nigerian Naira at the exchange rate at the moment of providing help, and you were credited with Mavro-Naira in your PO.

“It was the naira amount that grew. In other words you received 30% a month specifically in the naira (not in Bitcoins, although you originally provided help using Bitcoins). Now, you have a chance to have 30% growth of the Bitcoin amount, not the naira amount.

“So, acquire MAVRO-BTC which will be credited in your PO and will grow at a 30% monthly growth rate. In a month not only 30% will be added to your initial amount, but it can increase itself due to Bitcoin price growth.”