Friday, 19 April 2024
Nigeria may regulate bitcoin trade, and calls the cryptocurrency a gamble
Nigeria, where bitcoin trading grew the most in Africa last year, has said investing in the crypto-currency is a "gamble" and hinted it may have to be regulated.
"Crypto-currency or bitcoin is like a gamble, and there is a need for everybody to be very careful," Central Bank of Nigeria (CBN) governor Godwin Emefiele said in an interview at his office in the capital, Abuja. "We cannot, as a central bank, give support to situations" where people risk savings to gamble."
Emefiele is the latest among regulators globally to express concern about bitcoin, one of the most popular crypto-currencies, because of high volatility and a perception that it facilitates crime. In January 2017, the central bank released a circular to lenders asking them not to use, hold, or trade virtual currencies pending "substantive regulation and or decision by the CBN".
Still, demand for the digital currency is surging in West Africa’s biggest economy, with peer-to-peer transactions rising almost 1,500% this year, second only to China, according to data from LocalBitcoins. A bitcoin wipe-out would generate the biggest losses in Russia, followed by New Zealand and Nigeria, according to a report published by Citigroup in December.
On Thursday, UK Prime Minister Theresa May promised to consider clamping down on the crypto-currency. Central banks in China and Russia have stopped local-exchange trading of bitcoin.
"I have asked my colleagues in the research and monetary policy department to study the market and get to know what the issues are," Emefiele said. The central bank may in future "make some very concrete pronouncements as to the direction", he said, without giving details.
Re-disseminated by The Asian Banker from Businesslive.co
