In a notice to its customers. The Union Bank of Nigeria said that effective immediately they would be monitoring accounts which are involved in trading digital currency intending to shutting them down without explanation. This is, according to the bank in keeping with the various warnings issued by the Central Bank of Nigeria, in the past. This announcement has however caused an outrage amongst the cryptocurrency and blockchain enthusiasts, who have taken to Twitter and other forms of social media to vent their doubts about the integrity and financial literacy of the country’s banking sector.
“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.”
The bank provided that the reason for such decisions was based on cautionary statements from the CBN.
Adekola Seyi, a user, began a thread questioning the Union Bank about their basic research skills and criticized the country’s financial system for taking such retrogressive steps. Seyi even went on to explain the basics of blockchain technology in layman terms, to illustrate the Union Bank’s mistaken idea about the technology and the CBN directives.
Another Twitter user, Omuswe Precious, said that Nigeria’s banks not open to innovation while the entire world is fast moving ahead. He posted:
Y’all sit there lazying about while d global market cap for cryptocurrencies is already worth more than your ancient institution. Guess this sort of laziness is d reason it takes your bank over 10 working days to reverse failed transactions whn other banks are on auto-reversal.
He called the bank the “worst scammers” and “unfit” and pointed out that ATM maintenance fees and manipulative charges for SMS alerts Card Maintenance fees and the likes were hampering the public trust in these banking institutions and one day; they would just be used as a store for private keys and wallet addresses.
The Central Bank, in January 2017, sent a circular to financial institutions asking them not to allow any kind of transaction of virtual currencies, that did not have “substantive regulation and or [a] decision by the CBN.” Another circular in February 2018 also reiterated the same thing, and added that “virtual currencies are not legal tender in Nigeria … we wish to caution all and sundry on the risks inherent in such activities.”
This sudden decision has resulted in a sense of panic amongst the digital asset community of the country while there are already reports of crypto investors withdrawing their money in fears on a possible account freeze.