More clampdown on crypto in Nigeria

When the Nigerian Central Bank under the leadership of Godwin Emefiele banned direct withdrawal and deposit of Naira from Binance exchange to personal accounts and vice versa respectively, very few crypto enthusiasts were bothered and the reason is not far fetched. Peer-to-peer transactions were already gaining ground and many crypto users just switched their full attention to p2p while those that had no knowledge before then learned in a matter of days.

Since then, things have been going on smoothly with crypto enthusiasts proudly showing off their association with the immutable ledger technology all over social media. Millions in crypto transactions are conducted via p2p every day and buyers/sellers are warned not to include anything crypto-related in the transaction narrations.

What everyone thought has been put to rest now seems to be awake again, this time with much more impunity and lawlessness that seems to have characterized the Nigerian democracy under the current government. The central bank seems to have recruited some spies who signed up as merchants on Binance and cunningly lure people into transacting with them by offering a little above the normal price. They transfer funds to your account and deliberately put a tag that gives off the transactions as crypto-related. This was simultaneously followed by a circular to banks by the same central bank to start closing accounts suspected to be involved in crypto transactions.

The outcome is that many accounts have been closed up in the past week without any prior notice to the account holders. In fact, the circular did not limit it to transactions with crypto-related tags, any account with considerable inflow and outflow belonging to youth is a target. Yes, they even put an age limit which is 30.

Evidence of this newly found tyranny by the Nigerian government and the CBN abounds. Some of them are shared below. Images are from @DavidHundeyin on Twitter.

Above is a leak of the circular sent out to some banks stating all the red flags for crypto transactions according to their judgment. Following the red flags, even some accounts that have nothing to do with crypto would be affected. In actual fact, it is already happening.

Above is one of the transactions sent by one of the Central Bank's spies placed on Binance. The real crypto folks know that it is taboo to tag payments with anything crypto-related as this will place your account on red alert.

And above is the mail received by the owner of one of the flagged accounts to explain the inflow within a specified period. If the owner refuses to justify the transaction, we all know what will happen.

Is there a way forward?

If the central bank successfully executes this impunity, it is going to be dark days for crypto as far as Nigerians in Nigeria are concerned, especially for those of us whose chunk of income comes from crypto. However, it is not that there is totally no way out.

For sure, not all accounts can be flagged because that will require a huge amount of time and resources. Crypto users will just have to be more discreet and smart with their transactions. It is not likely my own account will be flagged as only stipends enter my account from the little I make off hive monthly.

Banks will also do not want to lose a huge number of customers who serve as points of revenue generation for them. Closing down multiple accounts means that their own income will also dwindle. Another option would be to take an indirect approach to exchange one's crypto.

I just hope that this government's madness ends as soon as possible.

Thanks.