Is Bitcoin Legal in Nigeria?
A common precaution employed by investors is to assess the legality of any business opportunity before jumping for it. In this case, the legal state.
A common precaution employed by investors is to assess the legality of any business opportunity before jumping for it. In this case, the legal state of bitcoin is one of those incidents in which its legality should be clarified before considering an investment. Which brings us to the question, what is the current legal state of bitcoin in Nigeria?
For those wondering the case you have such legal questions lingering on your mind, this article aims to provide answers to them. Also, here’s a fact, there is no law in Nigeria that makes dealing and trading in cryptocurrencies, including Bitcoin, illegal or criminal.
In fact, engaging in such transactions does not amount to “criminality”. However, it is what the cryptocurrency user does with it or in the process of the transaction that determines its legal or illegal status.
CBN on cryptocurrencies
On 28th February 2018, the country’s financial regulator, the Central Bank of Nigeria, issued a statement where it reiterated that all the different types of cryptocurrencies such as Bitcoin (BTC), Tron (TRX), Ripple (XRP), Monero (XMR), Litecoin (LTC), Dogecoin (DOGE), Onecoin, and others are not licensed or regulated by it.
Part of the statement which was signed by the Acting Director, Corporate Communications, Isaac Okorafor, reads:
“For the avoidance of doubt, dealers and investors in any kind of crypto currency in Nigeria are not protected by law. Virtual currencies are traded in exchange platforms that are unregulated, all over the world. Consumers may therefore lose their money without any legal redress in the event these exchangers collapse or close business. Members of the public are hereby warned that virtual currencies are not legal tender in Nigeria.”
What does that mean for the legal state of Bitcoin?
Note that the above quote does not criminalize bitcoin and other cryptocurrencies. It rather pointed out that virtual currencies, including bitcoin, are not legal tender in Nigeria (just like in some other countries as at that time).
But that does not dispel the fact that cryptocurrency has revolutionized the global monetary system and is slowly evolving into a viable legal tender in parts of the world.
What is the National Assembly’s take on this?
A year after the statement was issued, Speaker of the House of Representatives, Femi Gbajabiamila, said that there is a need to come up with legislation on cryptocurrency, as it is gradually accepted all over the world.
In his words, “I think the world is taking the issue of cryptocurrency and block-chain technology seriously. We don’t want to be left behind, and we have to take it seriously.”….“The House is ready to work with you (Nigerian Deposit Insurance Corporation) on that so that we don’t get left behind and within legislation and regulation of block-chain application that will put Nigeria within that rank of advanced technology.”
Nigerian government makes a move to regulate things
Yielding to the calls of Gbajabiamila, the Ministry of Justice sent some bills to the National Assembly to provide a legislative framework for digital currencies.
Attorney General of the Federation, Abubakar Malami, announced this on the 28th of July 2020.
He gave the names of some of the bills as Electronic Transaction; Electronic Evidence Act; Digital Management Act and Electronic Banking Act.
Malami hoped that the bills will prepare Nigeria for emerging realities relating to digital cash, bitcoin and e-currency, as well as enshrine transparency in the digital financial sub-sector of the economy.
The legal future of Bitcoin in Nigeria
On the 11th of September 2020, the Securities and Exchange Commission took a cue from the Attorney General of the Federation when it issued a statement proposing a legal framework that will regulate “Crypto-token or crypto-coin investments when the character of the investments qualifies as securities transactions.”
The planned regulation, which is aimed at promoting market efficiency and transparency and not to impede the nascent technology, recommends that any individual or corporate body whose activities involve any aspect of Blockchain-related and virtual digital asset services must be registered by the Commission.
Although Bitcoin is yet to be recognized as a legal tender in Nigeria, people who trade and buy Bitcoin or other cryptocurrencies are not breaking any legal law in Nigeria since none exist to that effect.
Amidst the continued devaluation of the Naira in the global money market, Nigerians are beginning to turn to Bitcoin for safety, since it provides security more than fiat money.
Bitcoin has a bright future in Nigeria, especially with the launch of the first crypto Automated Teller Machine in Lagos earlier this year.
Buy Bitcoin in Nigeria: Click here to get started.
Nigerian investors and entrepreneurs in Bitcoin are full of expectancy that in the coming days, the Central Bank of Nigeria would give its blessings to digital money and also create a working regulatory framework for their financial assets.
Until and after that happens, Easy Crypto Nigeria still offers the best buying and selling platform for Bitcoin and other cryptocurrencies.
Click on Easy Crypto to learn more about our services and get your more answers to your crypto questions.
Disclaimer: This article is not an investment advice. However, at Easy Crypto Nigeria, we are open to giving further information, clarification and counsel on the subject matter. Please contact our team for more information or discussion.