Nigerian startups requests for Legal Guidelines from the Central Bank of Nigeria

Requests have been made to the Central Bank of Nigeria (CBN) by the Nigeria’s financial technology startups to make available legal guidelines for block chain and cryptocurrency business sectors.

Reports from the Electronic Payment Practitioners Association of Nigeria (E-ppan) has it that absence of proper regulations is driving investments out of Nigeria to other African countries like Rwanda and most countries in Europe.

The Guardian newspaper quotes Ade Atobatele, a member of the E-ppan association and also founder of the Gboza Gboza Technology Ltd saying; Countries like Rwanda and Malta who have the needed legal regulations that covers cryptocurrency and other block chain business are now getting a lot of such investments today. He said this while speaking recently at a conference arranged by the fintech lobby group, E-ppan in Lagos, Nigeria. Mr. Atobatele noted how fast the block chain technology grows, it grows at a rate even more faster than its financial controllers can cope with. Hence, there is need for legal regulations to be implemented so as to give guidance and handle risk and service delivery issues which are common in block chain investments. He said as I quote;

“We have a license with CBN, but our blockchain-based services are being operated in Rwanda, which has offered us the license”

The E-ppan is an established representative body with connections on regulations that govern the electronic payments industry with the Central Bank of Nigeria (CBN). A bold statement on the associations website states “We influence the policy environment by applying pressure strategically to key decision makers to change the business environment positively.”

With a GDP of $400 billion back in 2014, Nigeria was the country with the richest economy in Africa, even outwitting countries like South Africa. Despite this, there were still traces of money laundering, inequalities and corruption in the country. The CBN Governor, Godwin Emiefele compares Crypto trading to Gambling so Crypto traders in Nigeria have been trading with carefulness. Nevertheless, the parliamentary wing of the country initiated an investigation of the positive and negative sides of making bitcoin a recognized legal payment method.

Notwithstanding, citizens of Nigeria are still diverting into making use of e-currencies, seeing it as a better means of sending and receiving money in and out of the country whilst taking advantage of the current economic state of the country and the current exchange rate of the Naira to major foreign currencies.

After Russia and New Zealand, Nigeria is the third country in possession of the bitcoin as a part of the GDP according to CitiGroup. In total negligence of the risk warnings from regulators, new business ventures have been involved in e-currency exchange and initial coin offerings.

At the said conference, One of the CBN officials Mr. Musa Jimmoh acknowledged that the legal regulations will sooner or later be implemented. Nigeria and other West African countries were advised by Michael Kiberu, chief executive officer of Vault Bridge and a member of E-ppan to borrow ideas from countries like Uganda, Switzerland, Kenya and Japan where there is legal regulations in Crypto currency operations.