Nigerian Fintech Firms Warn Clients Against Cryptocurrency Transactions

Nigerian fintech companies Moniepoint, PalmPay, and Paga have cautioned clients against conducting cryptocurrency transactions through their services, threatening to block accounts. Users have shared relevant messages.

MoniePoint will shut down your account and report you to the authority if you make any attempt to trade cryptocurrencies, NFTs, or other virtual assets via their platform.

My question is simple: Does MoniePoint accept deposit and/or withdrawal of cryptocurrencies, NFTs, etc pic.twitter.com/vmlSL09aGN

— ✳️BARON✳️ (@barryelon) May 3, 2024

Moniepoint refers to a directive from the Central Bank of Nigeria (CBN) in its notification.

“In accordance with CBN regulations, we will close the accounts of anyone involved in transactions with cryptocurrencies or other virtual assets and forward their details to the relevant authorities,” the company is quoted by Cointelegraph.

A PalmPay client reported on X about their account being frozen. The firm required them to sign an agreement to refrain from cryptocurrency transactions to unfreeze it.

Not just moniepoint, Palmpay freeze my account and requested I signed this agreement before they unfreeze it pic.twitter.com/qLYNQH4S8S

— QATARLYST $XTER $BEYOND (@Swiit_sam) May 3, 2024

Paga, in an email to clients, referred to a 2017 CBN circular prohibiting financial institutions from facilitating digital currency operations.

The Central Bank of Nigeria has made contradictory statements regarding the crypto market. In 2017, the regulator stated it could not control or regulate Bitcoin. In 2021, it banned banks from servicing crypto exchanges, but lifted this restriction in 2023.

Last week, the CBN denied a request to freeze bank accounts of crypto exchange clients. At the time of writing, this tweet has been deleted.

Meanwhile, the Blockchain Industry Coordinating Committee of Nigeria (BICCoN) and the local Securities and Exchange Commission (SEC) have invited representatives of the cryptocurrency industry to a roundtable to discuss market regulation. The meeting is scheduled for May 6, reports Cointelegraph.

Reportedly, the new head of the SEC, Emomotimi Agama, has extensive experience in blockchain and capital markets and is interested in engaging with key virtual asset service providers.

Nigerian authorities are concerned about the impact of cryptocurrency exchanges on the country’s economy. Telecommunications companies have been instructed by the government to block access to several platforms, including Binance, Coinbase, and Kraken.

Binance Holdings Limited and two top managers of the exchange, Tigran Gambaryan and Nadim Anjarwalla, face charges of tax evasion. The court case has been adjourned until May 17.

Amid the proceedings, Nigeria’s SEC has proposed a 400% increase in registration fees for crypto companies.