The Central Bank of Nigeria (CBN) has introduced measures restricting cash withdrawals from accounts opened for virtual and digital assets transactions. According to the new “Guidelines on Operations of Bank Accounts for Virtual Assets Service Providers,” withdrawals from such accounts will only be possible through transfers or manager’s cheques.
The CBN emphasized that accounts opened under these guidelines should exclusively serve transactions related to virtual/digital assets and should not be used for any other purpose. The guideline states, “No cash withdrawal shall be allowed from the account. No third-party cheque shall be cleared from the account. Except for settlement of a virtual/digital assets transaction, the withdrawal shall be only through a manager’s cheque or transfer to an account.”
This development follows a December circular from the CBN that signaled a policy shift toward embracing crypto transactions and directed banks to facilitate crypto transactions. The new guidelines provide a framework for reintroducing crypto into the formal banking sector, emphasizing minimum standards and requirements for banking business relationships with Virtual Assets Service Providers in Nigeria.
The CBN clarified that financial institutions are permitted to open designated accounts, provide designated settlement accounts and settlement services, act as channels for foreign exchange flows and trade, and engage in other activities permitted by the CBN. However, the central bank cautioned that banks failing to comply with the guidelines could face sanctions, including the prohibition from opening designated accounts, monetary penalties, and suspension of operating licenses.
