Nigerian crypto investors are expressing concerns after the Central Bank of Nigeria (CBN) flagged their bank accounts in connection with the recent Flutterwave hack. The CBN has frozen accounts suspected of having links to the $6.3 million hack, which is believed to have flowed into the Nigerian crypto market through various over-the-counter (OTC) platforms.
Flutterwave, a Nigerian fintech company, reported the case to the Deputy Commissioner of Police in Yaba, Lagos, alleging that almost $6.5 million had been illegally transferred from their client’s accounts. A motion ex-parte was filed and granted on February 27th, putting 107 accounts on lien/Post-No-Debit (PND).
The frozen accounts include those of innocent parties, causing confusion and possible legal repercussions for unsuspecting entrepreneurs who have received payments for their services with funds allegedly linked to the hacked amount.
This situation has discouraged P2P users from interacting with OTC markets and has caused some businesses to crumble. Despite strict crypto regulations by the CBN, the P2P market has aided Nigerian trade. However, some financial analysts view it as a black market hub for scammers laundering fraud funds.
Flutterwave denied the hack, stating that it had identified an unusual trend of transactions on some users’ profiles and immediately launched a review in line with its standard operating procedure. They revealed that some users who had not activated some recommended security settings might have been susceptible, but they were able to address the issue before any harm was done to their users.
The situation has caused concern amongst some community members who fear it could affect the general interest of Nigerians who are yet to get on board the crypto digital ecosystem in acquiring digital assets. As one concerned Nigerian stated, “This situation is causing some businesses to crumble.”
The CBN’s action has also affected the P2P market, which investors across the world use as a medium of direct exchange of crypto between parties without the involvement of a central authority. This situation has raised concerns about the future of crypto in Nigeria and the impact it could have on the country’s economy.
As Nigeria maintains its position as the largest crypto hub in Africa, it is crucial for the government to address the challenges facing the crypto market while also supporting its growth and development.