Cryptocurrencies are like gambling, Emefiele warns Nigerians

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Central Bank of Nigeria (CBN), Governor Godwin Emefiele is of the opinion that Nigerians involved in the trade of cryptocurrencies are speculating.

Speaking recently on the issue, Emefiele said cryptocurrency or bitcoin is like a gamble, and that there is a need for everybody to be very careful. “We cannot as Central Bank give support to situations, were people risk savings to gamble,” he said.

Emefiele also disclosed that he had asked the bank’s research and policy departments to make recommendations on how to regulate the sector. 

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Regulators in the Nigerian financial sector have sounded several warnings concerning trading in cryptocurrencies. The CBN had in January last year issued a circular warning banks against trading in them, but has held several stakeholder sessions to get a better understanding of the industry

Exchanges in the country however, have applied stringent Know Your Customer (KYC) and Anti Money Laundering (AML) requirements.

The search for quick profits has attracted many Nigerians into trading of cryptocurrencies. The lack of regulation, both globally and locally has left a loophole for several people to create ponzi schemes guaranteeing quick returns.

The various cryptocurrency exchanges in the country have witnessing a massive spike in patronage, with some of them suspending the opening of new accounts.

China has taken an extreme position regarding cryptocurrencies. The country has banned its citizens from trading them, and instructed exchanges in the country to shut down. It has also hinted at asking companies involved in bitcoin mining to stop operations.

South Korea has also instructed exchanges in the country to close accounts opened anonymously. British Prime Minister, Theresa recently sounded a note of warning concerning cryptocurrencies, due to the possibility of them being used for crime. Japan has however embraced them, and licensed several exchanges.

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