Nigeria’s Central Bank (NCB) plans to regulate Bitcoin, focusing on Anti-Money Laundering and Financing of Terrosims (AML/FT). This information was issued in the Anti Money Laundering/Combating Financial Terrosims Stakeholders Consultative Workshop which took place in the capital of Nigeria (Abuja).
One of the speakers of the event was Mr. Okwu Joseph Nnana, deputy governor of Financial System Stability at NCB. Mr. Nanna stated that virtual currencies could be dangerous given that thay are not a legal tender of any country and has no borders and no jurisdictions, making easier to launder money.
On the other hand, Obot Akpan, deputy director of Financial Policy and Regulation Department at Nigeria’s Central Bank commented that the Financial Action Task Force (FAFT) noticed that “virtual currency payment products and services present an opportunity for money laundering and other crime risk that must be identified and mitigated. Virtual currencies present a wide range of issues and challenges that require financial authorities to consider and the challenges posed are unique and call for urgent regulator responses”. This comments were made following a FATF’s report , which states that virtual currency exchangers should be controled and monitored in order to prevent money laundering and financing of terrorism.
From our point of view, we believe it is necessary that regulators make efforts in order to understand, not only the economic ecosystem (eminently international) in which Bitcoin companies operate, but also how this technology works. In particular, Bitcoin (and its underlying technology) traces all the transactions made on the blockchain. That said, in contrast with cash, Bitcoin could be a solution (and not a problem) for preventing Money Laundering and Financing of Terrosism. Legal tenders circulating through bank accounts is absolutely traceable, but this traceability ends once this e-money is converted into cash using an ATM. Nevertheless, transactions on the blockchain will be recorded permanently.
In conclusion, we believe that Bitcoin regulation should be developed according to the evolution of this technology, in order to avoid the “exodus” of Bitcoin companies, like it is happening in New York because of the controversal bitlicenses. Over the coming months we will see how the goverments will (or will try to) balance the regulation of AML/FT and the creation of a healthy ecosystem for Bitcoin companies in order to make them easier to establish in their territory.