[2021-02-25] Cryptocurrency is not legitimate money - CBN

[DapanasFruit]

Nigeria’s central bank is doubling down on its anti-cryptocurrency stance. Godwin Emefiele, governor of the Central Bank of Nigeria, has defended the apex bank’s decision to ban banks from servicing cryptocurrency exchanges in the country.

Appearing before a joint Senate Committee on Banking, Insurance and Other Financial Institutions; ICT and Cybercrime; and Capital Market, Emefiele remarked that the CBN ban was in the best interest of Nigerians.

"Cryptocurrency is not legitimate money. Cryptocurrency has no place in our monetary system at this time and cryptocurrency transactions should not be carried out through the Nigerian banking system.”

Source: https://cointelegraph.com/news/cryptocurrency-is-not-legitimate-money-says-nigeria-s-central-bank-governor


So it looks like Nigeria is really closing its door to the continuing proliferation of many cryptocurrencies in that country. This is sad for many crypto holders and enthusiasts within Nigeria since encashing cryptos can now be harder as banks are not anymore dealing with this business and can also be sad for scammers who are using cryptos for their schemes (though they can easily shift to other means and ways, anyway). However, this will never stop cryptocurrency at all since P2P trading can easily be done.

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[cr1776]

And why should we trust what Nigeria says?  With around 12% inflation every year, they certainly do not know what "real money" is.  Given their lack of understanding the rule of law, I wouldn't believe a word they said either.

Given their slide toward authoritarianism - like the USA under Biden - the citizens of Nigeria should protect themselves by buying bitcoin since if this continues inevitably there will be capital controls, confiscations and border controls.  Like the Biden regime, big government erodes freedom and everyone suffers.  The degree of suffering being proportional to the degree of statism/authoritarianism/fascism/socialism/communism implemented.  If AOC, Bernie and Warren have their way, the Biden admin will be extremely destructive of liberty, equality and the rule of law in the USA.

[acquafredda]

By declaring that bitcoin is not some legitimate form of money, the only point of CBN is to try to discourage its citizens from using, trading and storing bitcoins. Nigeria is witnessing a huge adoption rate and if that continues, the useless fiat money they print will be outpaced by the hardest form of money available today.
This acts come out of fear, they are afraid of bitcoin disruptive potential.

[snipie]

By declaring that bitcoin is not some legitimate form of money, the only point of CBN is to try to discourage its citizens from using, trading and storing bitcoins. Nigeria is witnessing a huge adoption rate and if that continues, the useless fiat money they print will be outpaced by the hardest form of money available today.
This acts come out of fear, they are afraid of bitcoin disruptive potential.

Nigeria is not only Africa's leader in cryptocurrencies but also world's one or at least one of the top. As you said the adoption rate there is high and apparently this made banks itching... A lot of money will be circulating out of the banking system which will be harmful for everyone including banks! It is more pathetic to read the stance of their central bank.

[cr1776]

By declaring that bitcoin is not some legitimate form of money, the only point of CBN is to try to discourage its citizens from using, trading and storing bitcoins. Nigeria is witnessing a huge adoption rate and if that continues, the useless fiat money they print will be outpaced by the hardest form of money available today.
This acts come out of fear, they are afraid of bitcoin disruptive potential.

Nigeria is not only Africa's leader in cryptocurrencies but also world's one or at least one of the top. As you said the adoption rate there is high and apparently this made banks itching... A lot of money will be circulating out of the banking system which will be harmful for everyone including banks! It is more pathetic to read the stance of their central bank.

In think it needs to be phrased:
 A lot of money will be circulating out of the banking system which will be BENEFICIAL for everyone excluding banks!

Bitcoin represents the ability to have true ownership of the products of your labor and mind without the ability for the political class to syphon 2-2000%/year (12%/year in Nigeria) away from  you merely because they have the guns and army.

[acquafredda]

That is the real thing here: there is an infinite potential for bitcoin and specifically the Lightning Network, to create the conditions to render the old banking world a thing from the past really. Today's LN is like bitcoin in 2010-2012, it is just not ready yet but is there. And once money will start circulating outside the banking system for good, good luck with that dear CBN. 

[Carlton Banks]

it seems Nigerian bitcoiners disagree, lol

and this cuts right to the heart of the issue: if regular people choose a different money system, there really isn't anything the so-called authorities can do about it. The legitimacy of one money over another is purely about what perspective you look from, and the Nigerian central bank isn't happy which direction normal people are turning their heads

That is the real thing here: there is an infinite potential for bitcoin and specifically the Lightning Network

it's true that it's _potential_ right now

Lightning is now usable and reliable, which was the first challenge. It still needs more development, some of which just needs work on the LN protocol itself (anchor commitments, various advanced routing techniques), but some requires a softfork to Bitcoin itself (taproot is needed for scriptless scripts...which is needed for discrete log contracts; some way to get "empty inputs" is needed for eltoo... which is needed for channel factories...)

It's an exaggeration to say that the Lightning ux isn't smooth enough yet (e.g. breez wallet etc), but that doesn't mean it couldn't be made smoother (and cheaper, and with more network-level features)

[acquafredda]

Looking at the stats, taproot is not being challenged and so it should be activated hopefully soon™.
LN for everyday payments is there, it works, sometimes there can be some small glitches but it is there for everyone to use it. And I agree that UX speaking is ready enough for the average joe (can be improved more ok, but it is not command line only anymore )

[Charles-Tim]

it seems Nigerian bitcoiners disagree, lol

I think you need to watch the vidoe of Nigeria Vice Present speech in the recent summit in which he talks good about cryptocurrencies, or you can read the speech as I quoted it below in the link.

Below is also the stance of Nigeria SEC on cryptocurrencies.
Crypto market too big to ignore, says Nigeria SEC

The CBN president do not know much about cryptocurrencies and his comments always full of lies. He even said cryptocurrencies are anonymous and used for terrorism, I doubt Boko Haram even make use of bitcoin or any cryptocurrencies while most of the cryptocurrencies are not anonymous by pseudonymous.

https://bitcointalk.org/index.php?topic=5319881.msg56430350#msg56430350

[suzanne5223]

The undeniable that the CBN governor understands about cryptocurrency and its benefit is zero because the world is moving toward the integration of cryptocurrency and the claim that the CBN ban on cryptocurrency transaction by the banks is the best interest of Nigerians that's really absurd.
meanwhile, the stance of the Nigerian Vice president and SEC is positive so there's still a chance for cryptocurrency to be legal in the country.

[nelson4lov]

~Snipped
So it looks like Nigeria is really closing its door to the continuing proliferation of many cryptocurrencies in that country. This is sad for many crypto holders and enthusiasts within Nigeria since encashing cryptos can now be harder as banks are not anymore dealing with this business and can also be sad for scammers who are using cryptos for their schemes (though they can easily shift to other means and ways, anyway). However, this will never stop cryptocurrency at all since P2P trading can easily be done.

The central bank is just pained that crypto users in the country prefer to put their money into these high risk projects and are actually benefitting from it instead of patronizing financial products being offered by banks or other traditional financial institutions with mediocre returns. Banks rely on the funds from their users/investors to do business flawlessly and its harder to do so anymore as everyone seem to have turned to crypto. I don't think its because of the increased rate of internet fraud in the country but mostly due to the fact that Nigeria boosts as the 2nd largest country in terms of crypto usage  and  banks still get little to no participation from their customers.

I'm sure CBN inflicted the ban hoping if they cut our bridge between fiat and crypto that we'll back down. Not gonna happen because it's still a long shot.

[sunsilk]

That's really a sad statement coming from the governor of CBN. They should look into the welfare of their people and how cryptos are helping each of them. I don't think that they look into that stance and instead, they're just doing things according to their interest and not to their people.

The best interest for the people of Nigeria is that, if they're making well with cryptos then why they have to ban it? telling it that banning is in the best interest of Nigerians is misleading.

[Darker45]

The best interest for the people of Nigeria is that, if they're making well with cryptos then why they have to ban it? telling it that banning is in the best interest of Nigerians is misleading.

Well, we're not born yesterday. Does anybody still fully believe and trust the government? I suspect even among government leaders and officials themselves they don't trust and believe each other. So why do we believe that which they represent? Especially when they begin to talk of welfare and public interest, we should take their words with a pinch of salt.

Anyway, this is not the first time that CBN attempts to discredit cryptocurrency. In 2017, there was a similar attempt. If it failed years ago when the community was a lot smaller and weaker, it will doubtless fail more today.

[bbc.reporter]

That's really a sad statement coming from the governor of CBN. They should look into the welfare of their people and how cryptos are helping each of them. I don't think that they look into that stance and instead, they're just doing things according to their interest and not to their people.

The best interest for the people of Nigeria is that, if they're making well with cryptos then why they have to ban it? telling it that banning is in the best interest of Nigerians is misleading.

If reckon any government and central bank from any country will never give up their monopoly and control on currencies. Also, where did you get the notion that they care for their people? Do you think that poor countries are poor only by accident hehehe?

[bustabitsboy]

Nowadays, the topic of bitcoin and cryptocurrencies in general is very relevant for humanity.  CBN does this in its own interests to force people to abandon digital money, since cryptocurrency interferes with controlling the financial situation of the population.

[bbc.reporter]

@bustabitsboy. This type of oppression does not only exist in poor countries in Africa. This is all over the world, in Asia, South America, in Eastern Europe. The people who run the banks and who own much of the economy control the government and the central bank. Do you think their policies are there to help the people get out of poverty hehehehe?

[Karartma1]

It's a huge clash of powers unfolding right before our eyes. An old world based on financial control is now being opposed by a world where individuals can be their own kings in the terms of finance.
This is not going to be easy and those who don't see what's happening will be very much disappointed when the real fight will start.
What do we except by a a central bank whose only reason to exist is to pump more money into the system to help always the same ones and never the poor guys?
I see it a simple as that.

[sunsilk]

Also, where did you get the notion that they care for their people?

I said that they should, mate.

Well, we're not born yesterday. Does anybody still fully believe and trust the government? I suspect even among government leaders and officials themselves they don't trust and believe each other. So why do we believe that which they represent? Especially when they begin to talk of welfare and public interest, we should take their words with a pinch of salt.

Anyway, this is not the first time that CBN attempts to discredit cryptocurrency. In 2017, there was a similar attempt. If it failed years ago when the community was a lot smaller and weaker, it will doubtless fail more today.

I don't remember that they did that in 2017 but if that's so, means that they're really into stopping it even before. Whether we believe our governments or not, we're living in a country that has a government so whether we don't like them completely or we don't trust them, still the country is in their hands. 

[jamalaezaz]

@bustabitsboy. This type of oppression does not only exist in poor countries in Africa. This is all over the world, in Asia, South America, in Eastern Europe. The people who run the banks and who own much of the economy control the government and the central bank. Do you think their policies are there to help the people get out of poverty hehehehe?

you are 100% right. everyone who controls the fiat and banks do not like Bitcoin and crypto currency. it really doesn't matter if that is from a poor nation such as nigeria or United State. don't you see the Us SEC putting strict to stricter regulations everyday on crypto currency. that is why most projects and tokens do not allow Americans to join their sales.
so everyone should stop blaming Nigeria. it is the rotten system of the world.

[hv_]

It cannot be, as long as ppl / devs are changing it - how could anyone dont see that issue