While open banking has the potential to revolutionise the Nigerian banking industry, some of the essential infrastructure needed for it to thrive is still lacking. This article provides a comprehensive overview of open banking in Nigeria and the risks and opportunities that it presents.
At present, the Central Bank of Nigeria does not regulate virtual currencies. However, Bitcoin is bought and sold in Nigeria freely and the use of Bitcoin is becoming increasingly popular. Its users include forex traders, online investors, importers, exporters and betting sites, and there are a number of merchants in Nigeria where Bitcoin can be bought and sold using the naira.
Canada has recently introduced measures to regulate some aspects of virtual currencies. Under amendments to Canada's anti-money laundering and terrorist financing legislation, the Proceeds of Crime (Money Laundering) and Terrorist Financing Act, dealers in virtual currencies will have to register under the act. However, to date there has been limited experience in Canada with respect to fraud or money laundering involving virtual currencies.
Bitcoin and other virtual currencies have been attracting attention in Japan as a new settlement method due to their unique features, which conventional settlement methods do not possess. The official view of the Japanese government is that Bitcoin is not subject to most laws governing currency and money transactions, although certain industry groups using virtual currencies have adopted voluntary guidelines.
There is no specific legal framework regulating virtual currencies in Luxembourg. However, the authorities are fully aware that some tailoring is needed in order to adapt the financial regulatory framework to reflect the challenges of new technologies, especially with regard to virtual currencies. The financial supervisory body, the CSSF, has issued useful guidance in this regard.
Virtual currencies – predominantly Bitcoin – have become the focus of internet aficionados and young entrepreneurs. The possibility of paying for services worldwide simply by using a smartphone and without having to consider exchange rates is a unique feature that clearly outguns established financial systems. However, no legislative steps have been taken to provide a reliable legal framework allowing Bitcoin to develop.
Bitcoin technology is thought to have the potential to lower the cost and increase the speed of transactions by reducing the number of intermediary parties. Transactions that would have taken hours or even days can potentially be cleared in seconds. Small steps have been taken towards the regulation of virtual currencies in Sweden. However, legislative measures have yet to be introduced.