FG Warns Against Bitcoins, Other Digital Currencies

Nigerian Deposit Insurance Corporation (NDIC), the country’s financial sector insurance regulator, has again warned Nigerians against the risk of trading with digital currencies not issued by the Central Bank of Nigeria (CBN).

The CBN, also said that it has not endorsed the trading in virtual currencies, including bitcoin, ripples, litecoin, adding that “any bank or institution that transacts in such businesses does so at its own risk.”

All these are coming as Bitcoin hit a fresh all-time high last week above the $10,000 mark after a wild week for the cryptocurrency.

But the NDIC said he mandate of the corporation does not include providing insurance cover to risks associated with trading with digital currencies not issued by the CBN.

Mohammed Umar, director Research, Policy and International Relations, NDIC, “The financial regulatory authorities are not playing catch up on the digital currency race in Nigeria. There is no country in the world that allows its citizens to use digital currencies as money not issued by the Central Bank,”.

“No Central Bank will accept digital currency as a substitute for its national currency or part of its monetary system, when it is not able to control it.

“Nigerians must understand that adequate notice has been issued by all financial sector regulatory authorities, namely Central Bank of Nigeria, CBN, and Nigerian Deposit Insurance Corporation, NDIC, to warn Nigerians who want to trade in bitcoins as gamblers.

“They can only do so at their own risk. The CBN cannot say anyone cannot trade with it and NDIC will not insure any trading in any currency not issued by the CBN.” Mr. Umar stated.