On Feb. 5, Nigeria’s Central Bank issued a directive that bans cryptocurrencies. It also ordered deposit-taking banks and other financial institutions for the immediate closure of accounts transacting or operating in cryptocurrencies.

As stated in the circular, strict compliance is required. Any breaches will result in “severe regulatory sanctions”. The letter was signed by Bello Hassan, Director of Banking Supervision of Nigeria’s Central Bank.

In line with this, Binance has temporarily halted deposits on Nigerian naira.

Prior to this, a circular issued by the Nigeria Central Bank dated January 17, 2017, states that transactions with cryptocurrency exchanges are prohibited. Also, cryptocurrencies are not legal tender in the country. It also warned consumers against losing their money in dealing with crypto exchanges that may collapse or close.

Binance has announced that the temporary suspension of deposits will take effect at 7 PM (GMT+1) on Feb 5, 2021.

“Withdrawal services remain normal and will continue to be processed but might take slightly longer time than usual. We apologise for any inconvenience this may cause. We will continue to provide further updates as soon as they become available, and we are working closely with all relevant stakeholders.”

But Binance remains committed to supporting Africa’s crypto growth

Africa is a country ripe for crypto adoption. A young and literate population, massive use of mobile phones and smartphones, and a country with a thriving crypto community. Binance was the first crypto exchange that has recognized the country’s crypto potential. It has invested in five startups – one from South Africa, one from Kenya, one from Ghana, and three from Nigeria.

Facebook’s Libra is also eyeing the market. It has its sights for banking the unbanked. Akon, the Senegalese-American musician through its Akoin project, aims to be the exclusive currency of the Mwale Medical Technology City in Kenya.   

Rakesh Sharma, a business and technology journalist stated:

“Africa is rarely mentioned among the largest markets for cryptocurrency, but it may be set to steal a march over other markets.”

The high inflation rate in most parts of the continent was the main reason why people turn to BTC (bitcoin) and other cryptocurrencies. South Sudan alone has its inflation rate skyrocketed to 102% between September 2017 to September 2017 according to World Bank.  

In a country plagued by hyperinflation, they seek refuge in cryptocurrencies. But with the current instance by the state, where can Nigerians turn to? They turn to Twitter to make their voices heard. The hashtag #WeWantOurCryptoBack was facilitated by Nigerian crypto users and has retweeted over 26,000 according to reports.