Digital rights lawyers sue CBN, SEC over cryptocurrency prohibition

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A civil , Digital Rights Lawyers Initiative, has dragged Central Bank Nigeria and Securities and Exchange Commission court recent action apex bank that Deposit Money Banks should desist from transacting and with entities dealing cryptocurrencies.

. FHC/L/CS/ 188/2021 filed Monday, February 8, 2021 at the Federal High Court , the group said the , which is the first defendant, lacked the restrict financial institutions from dealing in cryptocurrency transactions.

The digital rights lawyers argued that the second defendant, SEC, had in a circular dated September 14, 2020, declared cryptocurrencies as legal digital assets “protected under section 44 the Constitution the Federal Republic Nigeria, 1999 (as amended)”.

The lawyers, therefore, asked the court validate the Investments and Securities Act 2007, which made SEC the apex regulatory body of the capital market.

They also prayed the court to declare the action as “ultra vires, unconstitutional, null and void” while also seeking a “perpetual injunction restraining the 1st defendant from regulating and/or regulating virtual currencies/ crypto currencies in Nigeria.”

The , which has not yet been assigned to any judge, was filed behalf of the group by its counsel, Irene Chukwukelu.

The PUNCH had earlier reported that the apex bank said cryptocurrencies promote activities and raise risks, among other reasons.

The development had generated an uproar with many Nigerians including a former Deputy Governor, Kingsley Moghalu, kicking against the move.

Moghalu had said there was regulatory dysfunction between the CBN and SEC. He had also argued that there was means of exchange devoid of risk, adding that if the CBN could manage the risks of paper currency and electronic payments and other means of exchange, it should also be able to mitigate the risks associated with digital platforms such as cryptocurrencies.