The Central Bank of Nigeria (CBN) has said it will bring up a regulatory policy framework for the implementation of cryptocurrencies in the country.
It disclosed this in a report on ‘Nigeria payments system vision 2025’.
The apex banking regulator had earlier banned crypto-related transactions in the banking system.
“The CBN would consider the development of a regulatory framework for potential implementation of ‘Stablecoins,” CBN disclosed.
Meanwhile, economists have faulted the apex bank’s consideration for the stable coin as ill-timed, considering the failure of the e-naira.
The bank added that “It would also continue its watching brief on Initial Coin Offerings as well as work with Security Exchange Commission to jointly develop a regulatory framework in the event of adoption of an ICO-based investment solution.”
According to Investopedia, Stablecoins are cryptocurrencies whose value is pegged, or tied, to that of another currency, commodity, or financial instrument, providing an alternative to the high volatility of the most popular cryptocurrencies, including Bitcoin, which has made crypto investments less suitable for common transactions.
Recall that CBN had banned cryptocurrency-related transactions in the country while claiming that digital currency was used for money laundering and terrorism.
The statement by the Acting Director, Corporate Communications, CBN, Osita Nwanisobi, said the ban on such transactions would not have any negative impact on fintechs.
He stated, “The use of cryptocurrencies in Nigeria is a direct contravention of existing law. It is also important to highlight that there is a critical difference between a central bank-issued digital currency and cryptocurrencies.
“As the names imply, while central banks can issue digital currencies, cryptocurrencies are issued by unknown and unregulated entities. The question that one may need to ask therefore is, why any entity would disguise its transactions if they were legal.”
Speaking on Wednesday, an economy and capital market analyst, Rotimi Fakayejo, said the policy, if implemented, would have no significant impact on the economy, noting that it was at the wrong timing.
He said, “We have tried e-naira and it is not working. I do not think CBN is thinking right. We all know how weak regulations can be in this country. The naira is not stable and foreign exchange instability and scarcity. I don’t see a reason why they will choose to implement such a policy.”
A capital market, and investment analyst, Wole Adeyeye, said that proper regulations needed to be put in place before such policies were implemented.