CBN Rolls Out Anti-Money Laundering Checks for Crypto Firms

As Nigeria’s digital asset market continues to surge with innovation and new players, the Central Bank of Nigeria has quietly stepped in with a watchful eye.

In a bid to stay ahead of emerging risks, the apex bank has launched a pilot supervisory programme focused on selected Virtual Asset Service Providers (VASPs).

Behind this move lies a deeper concern: safeguarding the financial system from the shadows of money laundering, terrorism financing, and proliferation threats. With the digital asset space evolving at a rapid pace, the CBN’s initiative signals a proactive effort to understand and manage the risks shaping this new financial frontier.

The initiative, anchored on existing legal frameworks including the Money Laundering (Prevention and Prohibition) Act 2022 and the Banks and Other Financial Institutions Act 2020, signals a more structured regulatory engagement with operators in the virtual asset ecosystem.

CBN in a statement said the pilot forms part of its broader risk-based supervisory strategy designed to “strengthen financial system stability and market integrity oversight of virtual asset-related activities within the Bank’s mandate.”

It noted that the exercise is not a shift in policy direction regarding digital assets but rather a supervisory engagement to deepen its understanding of emerging risks and operational models.

“This pilot does not alter, replace or supersede the existing regulatory framework governing virtual assets in Nigeria or the mandates of other competent authorities,” the CBN stated.

Consequently, it selected industry players for the initial phase which include Flutterwave, Paystack, KuCoin, alongside cNGN, Juicyway and KoinKoin.

The central bank noted that the programme is designed to build “a structured understanding of AML/CFT/CPF risks, business models, and operational practices across participating entities,” while also supporting firms to strengthen compliance frameworks in line with global standards.

In particular, the pilot aligns with recommendations of the Financial Action Task Force, especially around the implementation of the Travel Rule, which mandates transparency in cross-border digital asset transactions.

Participants in the pilot are expected to submit monthly compliance reports and key performance indicators, undergo detailed reviews spanning governance, customer onboarding and transaction monitoring, and demonstrate readiness to implement global compliance standards.

The apex bank further stressed that “participation in the pilot is strictly supervisory and does not confer any regulatory status, approval, licensing right, or authorisation on participating entities,” underscoring its cautious approach to the still-evolving sector.

The pilot will run in phases, with subsequent cohorts already scheduled, as the central bank intensifies efforts to close regulatory gaps and align Nigeria’s financial system with international best practices.

The post CBN Rolls Out Anti-Money Laundering Checks for Crypto Firms appeared first on Tech | Business | Economy.