Union Bank Of Nigeria Warns Customers Against Crypto Dealings
A Nairaland forum user behind the alias adewumiopeyemi shared an email he allegedly received from the Union Bank of Nigeria (UBoN) with the community on the forum, in which the bank warns their customer that UBoN accounts will be monitored for crypto transactions.
Union Bank’s statement paraphrases the Central Bank of Nigeria (CBN), who reminds all citizens that cryptocurrencies are not a legal tender in the country, and therefore, cautions all Nigerians against crypto transactions.
The email was allegedly received on November 26, 2018, and reads as follows:
The Central Bank of Nigeria (CBN) has advised that cryptocurrency is not a legal tender in Nigeria and has cautioned against transacting in them.
In order to guarantee the security of our customers’ funds, Union Bank will monitor accounts being used for cryptocurrency transactions and may impose restrictions including closure of such accounts.
We appreciate your patronage and we are committed to providing you with simpler, smarter banking services that best protect your interest and guarantee the security of your funds.
For enquiries, please call UnionCare – our 24/7 Customer Service Centre […]”
Union Bank of Nigeria will enhance the scrutiny
According to the email, the Union Bank of Nigeria will closely monitor all accounts connected with cryptocurrency transactions and possibly impose some restrictions or account closures for those who disregard the warning.
Nigerian banks may punish those dealing with crypto in many ways, but the Union Bank specifically mentioned the closure of such accounts, most probably without the prior warning. Of course, the bank also stated that these actions will be undertaken in order to secure the best service to its customers, and “to guarantee the security of their customers’ funds.”
Further, in the email, the Union Bank of Nigeria reassured their clients in their commitment to providing simpler and smarter banking services, designed to protect customer’s best interests.
Since the bank has yet to release the statement about the email in question, we cannot know if by “simpler and smarter banking services” they meant in comparison with blockchain-based solutions, but it would be interesting to hear Union Bank’s point of view when comparing the traditional and modern payment solutions.
No clear regulations in Nigeria
Union Bank of Nigeria is a branch of the Union Global Partners Limited, with total assets worth $4.1 billion. Considering the fact that the political climate towards cryptocurrencies in the country is somewhat unfavorable, it doesn’t come as a surprise that the company has decided to take this step.
Nigeria Deposit Insurance Corporation (NDIC), which serves as the country’s financial agency, also warned Nigerians against using cryptocurrencies. That stance was confirmed by the Central Bank of Nigeria, which also declared that bitcoin (BTC) traders are in danger of losing their funds by trading in an unregulated environment.
However, Nigeria still doesn’t have a regulatory framework for cryptocurrencies and crypto exchanges despite the fact that Nigeria’s Deposit Insurance Commission was urged by the country’s regulators to present a legal framework proposition for cryptocurrencies and trading platforms.
Taking that into account, it is easy to imagine how the possible lawsuit following the freezing of some account due to its connection with cryptocurrencies would be hard to resolve.
Nevertheless, the political opposition in Nigeria seems to be taking quite the opposite stance towards digital assets.
The Nigerian presidential candidate, Atiku Abubakar from the People’s Democratic Party (PDP), which is the leading political opposition in the country, stated that he wants to utilize cryptocurrencies and the blockchain technology to speed up the economic growth of the country.
Be that as it may, the Union Bank’s email published on the forum with more than 55 million users mostly received negative comments, which can tell a part of the story about Nigeria’s citizens’ opinion towards cryptocurrencies.
Bitcoin (BTC) volumes continue to rise in Nigeria
Interestingly, peer-to-peer bitcoin (BTC) trading volumes in Nigeria keep climbing since 2016 with no signs of slowing down. Bitcoin and cryptocurrencies are clearly especially important for troubled economic regions with weak and corrupted monetary systems and policies.
Disclaimer: This is not investment advice. Cryptocurrencies are highly volatile assets and are very risky investments. Do your own research and/or consult an investment professional before investing. Never invest more than you can afford to lose. Never borrow money to invest in cryptocurrencies.