Business and Economy

CBN bars cash withdrawals from crypto bank accounts

The Central Bank of Nigeria has recently announced a new directive regarding cash withdrawals from crypto accounts held with banks in Nigeria. As per the directive, individuals will no longer be able to withdraw cash directly from these accounts. Instead, withdrawals can be made through transfer or by obtaining a manager’s cheque.

This measure has been implemented to ensure that these accounts are solely used for virtual and digital asset transactions, as stated in the ‘Guidelines on Operations of Bank Accounts for Virtual Assets Service Providers.’ issued by the CBN. The guidelines explicitly state that cash withdrawals and third-party cheques are not permitted, except for settlement of virtual/digital asset transactions, which can be done through transfer to another designated account or by obtaining a manager’s cheque.

The apex bank has emphasized that virtual asset providers must adhere to specific guidelines when opening accounts. According to these regulations, financial institutions are prohibited from opening or allowing the operation of any account for conducting virtual/digital asset business unless it is specifically designated for that purpose and opened in accordance with the guidelines.

The approval of senior management of the financial institution is required to open such designated accounts. The guidelines also outline other instructions for virtual asset providers, including penalties for non-compliance by banks. These penalties include the prohibition from opening any further designated accounts and a monetary penalty of not less than 2,000,000.00 against the financial institution, its board members, senior management, and staff for any violations. Additionally, the operating license of a financial institution may be suspended. You can read the official guidelines from the CBN Here

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