A Federal High Court sitting in Abuja, in a Ruling delivered by Justice Taiwo O. Taiwo on 18th October 2021, has held that the Central Bank of Nigeria circular, referenced as BSD/DIR/PUB/LAB/014/001 of February 5, 2021, is not a law and the CBN lacks the requisite authority to declare the trading of Cryptocurrency illegal by a mere circular.

The ruling was delivered pursuant to a motion on notice filed by Risevest Technologies, praying the Honorable Court to discharge an interim freezing order granted by the court on August 17, 2021, in Suit No: FHC/ABJ/CS/822/2021 wherein the Central Bank of Nigeria was the Applicant. The motion sought to vacate an interim order freezing the account of Risevest Technologies and some other persons who had allegedly contravened the CBN Directive contained in the CBN Circular.

The judge pointed out that the CBN had failed to discharge its burden of proof neither did they produce any law that criminalises dealing in cryptocurrency in Nigeria and that the CBN circular, BSD/DIR/PUB/LAB/014/001 dated February 5, 2021 is not a law and therefore, the trading of cryptocurrency cannot be held to be illegal based on a mere circular.

The learned Jurist in delivering his ruling held inter alia as follows:

 “I have perused the counter affidavit of the Respondent and I see that the reason for freezing the account of the applicant is based on the alleged infraction of the circular of the CBN.”

“The law is trite that any conduct that must be sanctioned must be expressly stated in a written law.”

“Being unknown to law, circulars cannot create an offence because it was not shown to have been issued under an Order, Act, Law or Statute.”

“The learned counsel for the respondent has also raised the issue of public policy in his submissions against the application.”

“Can this court decide this application based on public policy as being urged on it by the learned counsel for the respondent? I think not.”

“I hereby discharge the interim freezing order of this court made on August 17, 2021, made against the defendant/ applicant.”

The decision of the Honorable Court is in line with Section 36(12) of the Constitution of the Federal Republic of Nigeria, 1999 (as amended) which states that:

“Subject as otherwise provided by this Constitution a person shall not be convicted of a criminal offence unless that offence is defined and the penalty therefore is prescribed by a written law; and in this subsection, a written law refers to an Act of the National Assembly or a Law of a State, and subsidiary  legislation or instrument under the provisions of the law.”

The implication of this ruling is that cryptocurrency trading in Nigeria as it stands is not an illegal or prohibited venture unless and until a law to criminalise it is enacted or this decision of the court is overturned on appeal to a higher court.