By Modupe Gbadeyanka
Nigerians have been warned to be very careful how they embrace digital currencies, especially bitcoins, emphasising that they have not yet be certified okay by the necessary regulatory bodies in the country.
Managing Director of the Nigeria Deposit Insurance Corporation (NDIC), Mr Umaru Ibrahim, disclosed last week at the 12th Abuja International Trade Fair the digital currencies were not issued or managed by any sovereign authority in Nigeria.
He admitted that in other climes, they have been fully embraced, but warned that anyone in Nigeria involved in the trade do so at their own risk as such currencies were not insured by the NDIC.
“In view of the growing popularity which the phenomenon is gaining in Nigeria, it has become important to state that digital currencies are not authorised by the Central Bank of Nigeria, and they are not insured by NDIC,” he warned.
NDIC is an independent agency of the Federal Government of Nigeria. The objective of the deposit insurance system is to protect depositors and guarantee payment of insured funds in the event of failure of insured institutions.
Speaking further at the trade fair, the NDIC boss said that the currencies were issued by private developers and dominated in units and accounts not necessarily attached to a fiat currency.
Mr Ibrahim reiterated the corporation’s collaboration with the Central Bank of Nigeria (CBN) in monitoring the emerging digital and virtual currencies operations and studying its financial implications for the financial system, as well as designing policies that would protect the economy from any negative effects such invention could bring.
The digital currencies come in the form of Bitcoin, Ethereum, Ripple, Litecoin, and Etherium.
Recently, at the Crypto currency conference held in Lagos, Deputy Director/Head, Payments System Policy and Oversight at the CBN, Mr Musa Jimoh, has disclosed that the apex bank has commenced arrangement to introduce a digital currency in the country a move to key into the global adoption of Crypto currency initiative.
Mr Jimoh was quoted to have said at the event that CBN cannot stop the tide of waves generated by the blockchain technology and its derivatives.
“Currently, we have taken measures to create four departments in the institution that are looking forward to harmonise the white paper on Crypto currency,” he had said.
Crypto currency is a digital currency in which encryption techniques are used to regulate the generation of units of currency, and verify the transfer of funds, operating independently of a central bank.
