Transcript: Beam Africa’s First-Ever AMA Session with Senator Ihenyen on Human Right Violation. He Shares Personal Safety Tips to avoid Police Brutality.

The Beam Africa community was thrilled to have Senator Ihenyen as our guest during the first-ever AMA session to have held in the community. It was a highly interactive session that borders around the growing global concern of Police brutality.

The interaction was segmented into a first and second section. In the first section, the Host, Agbona Igwemoh, asks @Senatorihenyen questions, while in the second section, members of the Beam Africa community engage the guest with questions.

We’ll present all the questions asked, as well as the responses, as it happened during the AMA session.

First Section: Agbona Igwemoh (host) with Senator Ihenyen

Agbona: Welcome Mr Senator

Senator: Thank you very much, Agbona. I’m happy to be here with the Beam Africa community.

Agbona: Awesome! we’re thrilled to have you here with us

I’m certain many in the Nigerian and African crypto space, know who you are, but to our international audience, and crypto noobs who aren’t familiar with you, can you please tell us a little about yourself?

Senator: I’m Senator Ihenyen, a lawyer who specializes in intellectual property and information technology law, which includes blockchain technology.

I am Lead Partner at Infusion Lawyers, Nigeria’s 1st virtual law firm where I head the firm’s Blockchain Practice and IP Practice.

I also double as the General Secretary of SiBAN, Nigeria’s blockchain association. Before being elected as General Secretary this year, I was the Vice-Chairman (Blockchain Policy & Regulations Subcommittee). I have had the privilege of working with some of the projects in the blockchain and cryptocurrency space, so I’m happy to be beaming at Beam Africa tonight.

Agbona: Can you tell us a little about siBAN and what they are doing for the crypto space in Nigeria

Senator: SiBAN is Stakeholders in Blockchain Technology Association of Nigeria, Nigeria’s blockchain association.

Back in 2017, while we had blockchain and crypto conferences and various programs going in the Nigeria blockchain space, there was no structure in the emerging blockchain industry, which to a large extent also negatively affected the space in some way.

While great organizations such as the Blockchain Nigeria User Group (BNUG) and Cryptography Development Initiative of Nigeria (CDIN) has greatly contributed to and continue to contribute to the growth of the blockchain space in Nigeria, SiBAN was founded in 2017 by stakeholders in Nigeria’s emerging blockchain industry who believed that players in the space needed to come together to self-regulate the space as there was no specific regulation in the blockchain space in Nigeria.

SiBAN’s mission is to self-regulate the blockchain and cryptocurrency space for consumer protection and investor confidence in the country and champion blockchain advocacy, regulations, and reforms. SiBAN comprises both individual and corporate members. Our various membership categories accommodate all players in the blockchain industry. We are driven by collective interest and always encourage everyone to join us.

Agbona: Brilliant!
I’m guessing some of the things SiBAN is working on in instilling investor confidence has to do with the government.

What will you say is the government’s view on cryptocurrency today in Nigeria?

Senator: Yes, the government has a significant role to play when or comes to instilling investor confidence in the space, a role that, unfortunately, the government hasn’t been doing a great job with, I must say. And I think one of the reasons for this is lack of understanding. As human beings, we have a way of viewing a thing based on our limited experience of that thing. Cryptocurrency is not different.

Cryptocurrency has become like the parable of the elephant and the blind men. The blind man who got hold of the tail of the elephant claims that an elephant is a rope. Another blind man swears on his grandmother’s graveyard that an elephant is a sword because he touched the tusk. And so on.

It is the same way the Nigerian government is approaching cryptocurrency. Although the Federal Government does not have an official position on cryptocurrencies, its several agencies such as the Central Bank of Nigeria (CBN) and Securities and Exchange Commission (SEC) for example have severally warned Nigerians to stare clear of cryptocurrency because it is not legal tender and therefore cannot be accepted as money in Nigeria.

Indeed, the head of a government agency in Nigeria once compared bitcoin to MMM! With limited and challenged views like this, it’s not a surprise to see our often overzealous law-enforcement agencies intimidate persons who deal in cryptocurrencies in Nigeria. Even banks are increasingly handing over their customers to a waiting police van at the slightest suspicion of crime just because the flagged transaction is related to a cryptocurrency transaction.

But to state it clearly and without doubt, cryptocurrency is not illegal in Nigeria. No government has declared cryptocurrency illegal in Nigeria. It is legal to deal with cryptocurrency.

The CBN restrictions of 2017 and 2018 only apply to banks and other financial institutions, and the restrictions never outrightly banned cryptocurrency transactions in Nigeria. The restrictions only warned banks not to put their money in cryptocurrencies and then regulated how banks must treat cryptocurrency transactions involving bank customers by applying the CBN AML/CFT regulations in other to protect members of the public.

So let’s just say that the Nigerian government may have grabbed the elephant by the jaws!

Agbona: Speaking of overzealous law-enforcement agents. We can all see what’s happening in the US. Sadly, Young tech and crypto savvy Nigerians suffer the same in the hands’ police agencies like SARS.

Will this ever stop?

Senator: It’s quite unfortunate. Human rights violation has even increased in Nigeria in the last couple of years. Human-right violation in Nigeria what might be described as the elephant in the room! It is quite unfortunate that human-right violations have failed to stop in Nigeria, even after the military left power for the civilians in 1999.

As long as law-enforcement agencies continue to fail to reconfigure themselves for a democratic society, human-right violations may never stop. But I don’t expect it to stop because the orientation remains poor. Law enforcement agencies need a total reorientation and reformation.

When a country has a largely dysfunctional criminal justice system, most times what you will always get in return is a law-enforcement system that is detached from human rights. Most, if not all, our law enforcement agencies often fail to appreciate that law enforcement is not an end in itself but a means to an end — law and order for a safer society for all where anyone in the street can have a dream without fear of a ‘’stray bullet’’.

Agbona, seriously, I don’t see this menace stopping anytime soon, especially because we are not bringing these human right violators to book!

Agbona: This is pretty gloomy, and one can only pray or wish not to fall into their trap. Should in case one gets accosted by SARS agents and the likes, what steps can one take to manage the interactions with these hostile security agents?

Senator: Alright, the first step, don’t call me!

Agbona: Lol!

Senator: 😂I am a lawyer, but not an anti-SARS pill!

At least twice a week, I receive reports of intimidation, harassment, and victimization of people in the tech space, especially in the crypto space. They are arrested without a warrant, thrown in detention for days without court trials, and even lose their legitimate funds in the course of interrogations. All these without any respect for the constitutional right of the Nigerian to a presumption of innocence until proven guilty. This right is sacred. It is guaranteed by the Constitution. But in Nigeria, it is the other way round — you are guilty until proven innocent.

From my interactions with players in the crypto space who have had bad experiences with law enforcement agencies, I find that one common problem is that most players in the space are not proactive about their security. Law-enforcement agencies often feed on this.

Prevention is better than cure! Where to start is to prevent hostility from law enforcement agencies. I always advise players in the space to comprehensively review and rearrange their personal and business affairs, ensuring that you are not leaving loopholes anywhere.

For those already in hostility situation, I will suggest the following steps:

1. Be firm but be calm: Don’t provoke the SARS or law enforcement officer to harm you. Trust me. They want you to lose control. It’s their greatest weapon against you. Don’t fall for it.
2. Be alert: Note the faces and the identity of each officer around you. Don’t let fear make you so apprehensive you lose memory easily. Although a slap from SARS can make you lose your memory, try to get as much detail as possible. You may need it along the line.
3. Insist that you have a right to silence and to your lawyer: most times, they will kill you first before granting your request. If it gets dangerous, go ahead and write a statement, but NEVER write such statement calmly. Make your handwriting look as disturbed and troubled as possible. This is a code. It will help your lawyer prove that Amy a confessional statement from you was not your statement.
4. When going to the station, never go with your phone or other gadgets!

Always have another phone where your contacts may be. The phone you use for your crypto business should be different. In Port Harcourt, I was involved in a case where the founder of a crypto business went with his phone to the police station. That was the end for him. Although we got him out of the jaws of the police days after

Lastly, join SiBAN or any other association that can stand for you when things go bad. In several occasions, SiBAN has been involved in getting arrested crypto traders out, because they have done their KYC with us. Do not try to do things alone. Join a community like Beam Africa as well. Other tips are available on consultancy!

Agbona: You mentioned here for one to review and rearrange personal and business affairs, ensuring no loopholes.

Can you shade more light on this, feel free to use examples or use cases.

Senator: Oh great, I will.

Many players in the space expect their lawyers to be fire brigade, always ready to put the fire off when things go bad. But why allow the fire in the first place?

In my 9 years of practising law, I find that it’s safer to be proactive. When you are proactive, you will see more of smoke, than fire, and you will be able to put it off before it burns down the house.

Let me give an example.

A crypto startup did ICO in 2017. Many invested in the coin, including persons who knew nothing about cryptocurrency and its volatile nature. 2 years later, investments in the coin went from millions to little or nothing. The investors who were ignorant about crypto reported to the police command of a state in the south-west. The police command started arresting the CEO and all employees of the crypto startup. They were in detention. I was asked to put out the fire.

What did the crypto startup do wrong? I will list them:

1. There was no document detailing how the coin sold to people worked

2. There were no terms of service on its website

3. There was no investors agreement (if we call them that at all)

4. There was no legal policy

5. There was no AML/CFT/KYC policy

All these, and more, worsened their cases. The crypto startup failed to arrange its affairs safely Any crypto traders in the space today also make the same mistake.

I will tell you about one case that emanated in Uyo and had the crypto trader sleep in detention for 2 months in Kano. It started with an OTC transaction. A bank-account hacker bought bitcoin from an innocent crypto trader, amounting to about N4.5m. The hacker had hacked into another person’s GTBank account, and used his access to the account to buy bitcoin. When the real bank account owner received a debit alert, he reported the matter in Kano. Fast, the police instructed GTBank Uyo to hold the innocent crypto trader down. He was arrested thrown in a van, travelled overnight to Kano with police officers all over a little profit made from the 4.5m transaction.

SiBAN eventually intervened, with help from other SiBAN members. Lesson; As a crypto trader, you must arrange your affairs properly. That crypto is unregulated doesn’t mean you shouldn’t regulate yourself, otherwise, you will be ‘’regulated’’ by EFCC and friends. Always insist on KYC. It may not always make you good money, but it will keep you safer.

Agbona: Lastly, before we open the channel for questions from the audience

1. What does it take to join SiBAN?
2. When yawa cast, are there phone numbers we can reach out to, should in case, we get into a sticky situation with hostile security agents, in short, can we have your phone number?

Senator: Thank you, Agbona.

To join SiBAN, all you need to do is complete our membership application form online. To do so, here’s a link to how that works https://siban.org.ng/membership-application/

Be sure to view the membership categories and their respective benefits so you know the membership category that you fall. Everyone in the space is accommodated in SiBAN, where a newbie or expert.

2. The number you can reach when you need some assistance:

08067351417 (SiBAN Secretariat)
08098764066 (Senator)

Phase 2: Questions from the Community

Atrick: I have used the example bank accounts are private not because you don’t want the government knowing what you purchase but because you don’t want the public to know what you do with your money.

Most governments believe privacy coins are for illegal purposes; however, could you explain with some details and examples rhetorically if and why you believe privacy away from a public ledger is a human right and why private ledger like Beam is necessary for public safety?

Senator: Great question, @target_user_name Privacy will increasingly be that sacred right that government cannot help but allow, especially in a world where the government is no longer the sovereign trust.

Privacy has always been what the government wishes to enjoy for itself alone, but when people begin to talk about privacy rights, governments understandably become hostile.

I think that it will change over time because more people demand privacy today. Though fraudulent people will always use privacy to commit crimes and carry out other illicit transactions which have been one of the major argument by the government against privacy, privacy coins such as Beam, for example, cannot and should not be given a blanket treatment as dark coins or whàtever bad name the government gives a dog in other to hang it.

As currency gradually leaves the central or reserve bank’s control to become decentralized, privacy coins will increasingly come under high demand. We are still in the early days of decentralization. As the decentralized economy evolves and grows deeper, public ledgers will give way to private ledgers. Whether people use Beam or other privacy coins will be the right to privacy of citizens. Today, we already have

Privacy laws that protect people’s right to data privacy. Not in favour of any big tech or big government, but to protect the data of every person, the new oil in the data-driven economy. So privacy coins are the future as decentralization deepens.

Oxygen02: I am really glad to be part of this AMA because senator Ihenyen has opened up on so many things surrounding police harassment on crypto player’s

My questions go thus;

- What are the requirements to be part of SiBAN?

- Must I be a member of SiBAN before I can call them for any issue related to crypto?

• Aside from helping with police harassment, what are other benefits that come with being a member of SiBAN?

Senator: Senator: 1. The major requirements for joining SiBAN is that you are a stakeholder in Nigeria’s blockchain space and that you do not have any criminal record whatsoever. SiBAN will require you to do some KYC. The KYC you will do depends on what category of membership you apply for. Whether an undergraduate graduate, expert, professional, founder, and even an organization to a group, SiBAN welcomes you.

2. You don’t have to be a member of SiBAN before we can intervene in your matters, but we strongly encourage that you register because with that we would already have your records and be already familiar with your business. SiBAN does not put its integrity on the line in cases we are unable to verify the integrity of the beneficiary.

3. For membership benefits, different benefits apply to different membership categories. Please go here to see details https://siban.org.ng/membership-benefits/

Ufem Obasi: Firstly, I will like to appreciate you, sir, Senator Iyenhen for this pivotal information and I also appreciate our host, Agbona for paving way for this wonderful and educating session.

Sir, my question is peradventure, if SARS was given false information about my online dealings that it involves fraud activities and they came to my residence, do they have the right to 1) to arrest me without a warrant?.
2) Do they have the right to take along with them my gadgets to the station?

Thank you, sir!

Senator: Thank you for this question. This picture you have painted here is a familiar one in this space.

To state it categorically, SARS does not have the power or authority to arrest you without a warrant. The only exception under our laws is when in the circumstances, SARS or law enforcement agency can show that although it didn’t have a warrant, the circumstances of the case required them to act swiftly at that point in other to prevent a crime or to prevent you from frustrating justice. All law enforcement agencies in Nigeria usually abuse this exception. In your situation, a warrant is required.

2. They do not have the right to take your gadgets, without obtaining a warrant for search which must be in connection to suspicion or allegation of crime. However, because the Nigeria Evidence Act 2011 now allows anything that has been obtained from an accused person, whether legally or illegally, to be tendered as evidence against the accused person, law enforcement agencies now go about seizing gadgets and other personal properties without first seeking and obtaining a warrant.

So you need to be cautious.

Hardaeborla: Firstly I’ll love to thank you for your time and I must say I’ve learnt a lot from your write up but there are some questions I’ll love to ask which seems to appear clumsy or ambiguous to me.

1) You made a statement and I quote “No government has declared cryptocurrency in Nigeria. It is legal to deal in cryptocurrency”

But there are times whereby crypto traders do face challenges from their respected banks most especially if the transaction happens to worth millions of Naira. I’ve heard a crypto trader telling a bank manager he’s going to sue him if they don’t release his money. His account got frozen due to the transaction he made trading BTC online.

Also, some bank officials have the habit of you paying them a specific amount before you can trade your cryptos worth millions for cash into your bank account.

Does this mean that Nigerian banks are finding a means of earning from crypto traders or what can you say about this sir?

2) What is SIBAN doing about cases that have to do with unjust assault by police officials being experienced by legit crypto traders?

It’s very sad mistaken fraudsters for legit crypto traders making them treat these set of traders as fraudsters or yahoo boy.

I heard an incident about a FUNAB legit crypto trader trending on the Twitter back who committed suicide due to the false acquisition against him as a yahoo boy while he isn’t into such act. What steps or measures is SIBAN taken to eradicate such act or occurrence in Nigeria amongst the legit crypto traders?

3) Recently in India, Japan, China and some other developed countries, I heard they now allow the use of cryptocurrencies even some countries are inventing their tokens for the masses. What is SIBAN doing as regards this to promote Nigeria having their specific tokens? Or is it a bad thing if we also create our cryptos in Nigeria?

4) What are the future of blockchain technology and cryptocurrency in Nigeria?

5) What advice will you give to upcoming Nigerian crypto traders who may also be interested in the world of cryptocurrencies and blockchain technology?

Thanks for your time once again and I hope you’ll be able to do justice with the above questions.

Senator: 1. Indeed, there are many occasions where Nigerian banks treat crypto transactions especially crypto traders like some HIV. But it doesn’t mean that cryptocurrency is illegal in Nigeria. Not at all.

Cryptocurrency is legal in Nigeria but banks are restricted from dealing in crypto. But where a bank customer deals in crypto, CBN requires that the bank, if it must do business with the customer, must apply AML/CFT/KYC regulations otherwise face sanction.

The problem is that many banks now abuse it.

Again, another dimension you must appreciate is that indeed some cryptocurrency transactions ate outright fraudulent.

And there is also the dimension of an innocent crypto trader receiving money from a fraudulent source.

2. Because SiBAN continues to receive reports of harassments and victimization by law enforcement agencies from crypto users in the space, the SiBAN Chairman has started engaging the legal unit to consider some legal steps that we may take to arrest the situation. We only soft-pedalled when we considered that this may result in outright war between the association and the law enforcement agency. And we don’t want that. So we have started engaging them. Recently, the VC on Blockchain Education & Adoption, Joseph Samuel, was involved in crypto education for the Nigerian police. In October last year, I was also at the Police Command in Ekiti State where I had up to one hour with the police team there enlightening them about crypto, which eventually led to the investigation department doing a great job in a crypto-related matter.

We welcome ideas. You may send any to sec@siban.org.ng

3. The Nigerian government needs a fundamental review of its policy on blockchain and crypto before it can do anything meaningful with it. We don’t have a national blockchain policy! If we did, the government would know how best to leverage blockchain for good. Today, some central banks are talking about central bank digital currencies. That’s because they took some time to research and also listen.

At SiBAN, we are exploring collaboration with our regulators. When Chuta Chimezie of Blockchain User Group was SiBAN VC on Partnerships and Memberships, we had the opportunity to contribute to the SEC FinTech Roadmap, which has been adopted by SEC. We are also looking at NITDA, the country’s technology development house. We will continue to explore other opportunities for engagement with the government.

This year, SiBAN’s first national conference is coming up and it is centred on how blockchain can power the digital economy. We are engaging regulators to come to the round table.

The future of Blockchain and cryptocurrency is bright in Nigeria, but most of that brightness would be beams from the decentralized solutions young people in Nigeria are driving today,.not because any government became a part of it. Nigeria’s immense potentials in this space lie on the shoulders of its youth. And that’s the beauty and strength of Nigeria. We are inherently decentralized people.

5. My advice to crypto traders: Money, and fast money, will make you paint the town red in this business, but only integrity will keep you in. Building integrity will not come by engaging in crypto trading like a mere trader. No, build a brand. Separate your personal life from your trading business. Take contracts seriously. Avoid illegality. Never join the wrong gang. Join a beaming community that will help you grow healthily. Know what you are trading.

Sanusilamu91: Many thanks to Senator.
As we all know 80% of Nigerians don’t know about crypto, and 20% that knew about it only a few are making a profit from it. Is there provision for SiBAN to guide new users?

Senator: You are right. Many people still don’t know about crypto. SiBAN, three weeks ago, published a notice in the community inviting blockchain education providers to partner with SiBAN so we can decentralize blockchain and crypto education. We already have two local platforms on board. Next week, we hope to finalize one with an international platform. We will publish progress on our website www.siban.org.ng. Do subscribe so you don’t miss anything.

Juwonsmyle: This is a wonderful session. I love the part you talked about being calm and writing statement. They will help greatly.

My first question:

Lack of understanding was identified as the reason for harassment of Nigerians by police or other officers. What can we do to salvage this situation? Are there no areas we can explore to push this into their nose and let them see its potentials?

2: There is a Biblical saying that says ‘shall we continue in sin, that grace may abound? What can we do to stop this menace concerning harassment? Yes, they are not been tried, should we let it continue? There are things we should do to reduce this injustice.

Senator: SiBAN is exploring collaboration with the training arm of law enforcement agencies to assist with blockchain and crypto training for law enforcement agencies. But how we are going about this is to be seen as partners even when these agencies need our assistance in investigating crypto-related crimes for example when millions of naira were paid in ransom to some kidnappers in bitcoin in Abuja last year, it got to our ears at SiBAN. We were able to assist the police in appreciating that money collected on bitcoin is not as private as they think but could be traced. I am unable to disclose the details here but the police were happy to get that assistance as it helped them demystify bitcoin.

We continue to tell our members to stay away from any illegal acts in the space.

2. I also think that we should be able to do more in that regard. SiBAN welcomes any suggestions from the community. We can’t do this alone. You may also see my response to a similar question above.

And yes, we can sue. We will only need a supportive community so we can raise adequate funds for prosecuting these guys.

Vincent Ejimadu: Senator it is a good and interactive section that you’ve given to us. Please can you throw more light on KYC policies and that of CBN AML and CFT regulations?

Senator: Briefly, CBN and other relevant agencies such as law enforcement agencies are suspicious of certain transactions. Indeed, people with fraudulent intentions, engage in illegal transactions under the pretext that those transactions are legal. These are illicit transactions through which people perpetrate crimes using bank accounts and crypto accounts as pipelines. To minimize or avoid this, AML/CFT/KYC regulations were introduced AML means Anti-Money Laundering; CFT means Combating Financing of Terrorism; KFC means know Your Customer. In Nigeria, banks implement the AML/CFT Regulations of 2009, Terrorism (Prohibition) Act of 2011 (as amended), and CBN Three-Tiered KYC of 2018

Not forgetting the KYC obligations of financial institutions under the Cybercrime Act 2015. These are regulations that have been made to ensure that funds are not been transferred either illegally or to fund illegal activities. And this is one area privacy coins come under heavy suspicion by governments.

Clinton Oputa: Good evening senator, I have read all you said but my question remains
1)a situation whereby your phone was being flushed before this incident and you’re taken to the police station how do you get to get the phone number. is the phone number written in the site is there any way of identifications
2) is SiBAN just a Nigeria organization or there are other countries involved

Senator: Thanks for this question. As the SiBAN General Secretary, I will ensure that by next week the secretariat makes the numbers to call easily accessible, including on our website. We may also get dedicated lines, as we get support from the community.

2. SiBAN is only in Nigeria. We collaborate with similar bodies outside Nigeria

Groot: Some people prefer not to give their details (documents) to any crypto exchange or exchanger for transaction purposes (KYC, AML). Beam as a community itself, emphasizes heavily on the option of complete anonymity.

Sir, would you say it is especially (more) risky for exchangers who chose to trade privacy coins?

Do you think the crypto industry in Africa is ready for total anonymity with privacy crypto?

Senator: I can understand why anonymity is a critical feature in privacy coins. And as you have observed, privacy coins and KYC/AML requirements are strange bedfellows.

We must concede that at this stage of the evolution of the thing we call trustless technology, centralized exchanges and other centralized crypto platforms will continue to require that some level of KYC/AML is met. Just yesterday, my team and I at Infusion Lawyers were assisting a crypto exchange to develop a workable framework for this — a framework that doesn’t only meet the regulatory requirements but also their business interest.

So I think that crypto exchanges, where centralized, will face more risks with privacy coins. Privacy coin developers and promoters will need to continually engage potential users and members of the public about the advantages of privacy coins. There are many fine advantages to it and I dare say that privacy coins also have their unique use cases too. Promoters may wish to emphasize these use cases.

As for whether Africa is ready for privacy coins, I think that this should be considered from two angles: (1) Cultural readiness and (2) Economic or market readiness. I will explain why briefly.

On cultural readiness, privacy in most African culture is seen as secrecy. And secrecy is almost seen as a bad thing since it can hide a lot, just the way people hide under darkness to harm. African governments and law enforcement agencies are likely to approach privacy coins in the same way. Privacy coin promoters will, therefore, need to invest in education. People need to learn that privacy is not always about secrecy, but a right to private and family life.

2. Economic or market readiness: Not every segment of the economy may be ready for privacy coins. Certain industries and segments of the economy will be more ready than others. Privacy coin promoters will need to research these industries and segments for the best use cases. Also, privacy coin developers, in other to make adoption or acceptance by ‘’centralized forces’’ less difficult, may need to consider integrating features in the private ledger that enables it to ‘’switch off’’ anonymity in certain circumstances. This is in line with most laws globally, where institutions, service providers, and ISPs are mandated to disclose the identity and details of a transaction whenever there is an order by a court of law or law enforcement agency to do so

Oxygen02: Another question I will like to ask here is related to online scamming. Is there anything SiBAN can do if there is any case of online scamming where you send your crypto out and you didn’t get your payment?

Senator: Send your complaint to info@siban.org.ng and copy scamalerts@siban.org.ng. Depending on the facts of the matter and the parties involves, we may be able to intervene. SiBAN also has a standing Ethics, Complaints, and Disciplinary Committee, especially when it involves one of our members. You can contact that committee here complaints@siban.org.ng

Second Wave

Ufem Obasi: Sir, as regards this statement you said below

“Cryptocurrency is legal in Nigeria but banks are restricted from dealing in crypto. But where a bank customer deals in crypto, CBN requires that the bank, if it must do business with the customer, must apply AML/CFT/KYC regulations otherwise face sanction”.

Can a crypto trader go inform the bank for KYC prior the incoming million gain of his crypto dealings to avoid the itch? Is this advisable?

2) As regard your statement below

“And there is also the dimension of an innocent crypto trader receiving money from a fraudulent source”

A buyer buying crypto from me, how can I detect he is sending fund from fraudulent source despite his KYC with the exchange site? Or one should ask if his name tallies with the account no? How can one not fall victim like that illustration you gave in kano sir?

Senator: 1. If you believe that your bank is less hostile to crypto trading or crypto transactions, your bank account officer should be the person to inform. From my dealings with some banks, it appears GTBank and Access Bank are less hostile, but this is by no means a recommendation. I have handled cases involving GTBank and know a few crypto transactions flagged by Access Bank. Whatever you do, be careful who you disclose such sensitive information. Even bank account officers can’t be trusted these days. Ensure you start building a close relationship with your bank account officer. Don’t wait till when you have a crypto transaction.

2. You really can’t tell if the person buying crypto from you is sending money from a hacked account or an illegal source. You never know. But when the banks and the police starts asking questions or interrogating you, one of the first things they ask you is if you obtained the so-called fraudulent buyer’s details, including name, address, valid ID card, and phone number. If the answer is NO or largely NO, you automatically become the prime suspect. To minimize or avoid the chances of that happening, KYC helps. It’s all the bank expects because by taking on crypto trading business or by being involved in the business of exchange of money or something of value, they believe that you are now also a ‘’financial institution within the meaning of the CBN AML/CFT Framework and the Banks and Other Financial Institutions Act (BOFIA). I guess being ‘’your own bank’’ comes with its responsibilities!

I hope this helps.

Atrick: Confidential assets are something that Beam is adding to the Hard-fork June 28th. In the future, there will be revisions hopefully for great use cases like I’m about to describe and ask a question about. In the past, there have been incidents wherein Kenya, for example, the government has taken land private citizens have claimed they had rights to. I’m not sure if Nigeria has had similar problems.

Do you see a use case going into the future for Nigeria, not just for privacy coins like Beam but one of its features like private assets that can be publicly proven in a non-government controlled way; as well as, a method where a countries land can be divided and logically represented as a logical asset on the blockchain where it can’t be stolen?

Senator: Lands are being taken away from the people by the government now and then, including Nigeria. The Land Use Act ensures that. And the Constitution of the country empowers the government to do so even if the land is supposed to be yours.

Thinking of confidential assets, my mind goes to the digital transaction aspect and the digital asset aspect. On the transaction aspect, I think confidentiality is a beautiful thing, even though public ledgers are driven by the philosophy of openness. I have seen some experimentations with certain coins, applying confidentiality to make transactions confidential between the participants in the transactions alone. That’s the digital transaction part.

Now the digital asset part, confidential assets remind me of tokenization of assets, such that rights to assets such as real estates could be tokenized so legal rights are effectively converted to digital rights in the digital representations of these physical assets.

With Beam planning to introduce confidential assets to its new version in June, I think it’s a great idea. There is a potentially great use case for tokenization of real assets in Africa, including Nigeria. Though the Land Use Act which governs land ownership in Nigeria is not very friendly to such innovation, the largely unregulated real estate sector in a country like Nigeria presents a fine opportunity for adoption by private real estate developers. So it looks like something that would be private-sector driven. I don’t see the public sector coming in, at least not anytime soon.

The lands registry in Lagos hasn’t shown any interest in any blockchain applications in the real estate sector, but if the new Head of Records in Lagos is happy to consider the application of blockchain for record-keeping in Lagos sometime in the future as she declared recently, then it may be that all hope isn’t lost in the public sector in terms of gradual adoption by the government.

But I think the use cases for confidential assets got to be in the private-sector-led, largely unregulated and decentralized real estate industry.

Flora: Thank you for your time, Senator.

I understand that the vast majority of police harassment on tech and crypto enthusiasts happen to males

Have there been situations where females crypto/tech enthusiasts were harassed?

Also, what can we ladies do to protect ourselves?

Senator: First, please remain female! That seems to be one sure way to stay out of trouble with law enforcement agencies in Nigeria these days.

Yes, there have been occasions where female crypto/tech enthusiasts have suffered harassments. One particular case comes to mind. This happened 3 weeks ago.

A lady crypto trader was involved. This happened in Port Harcourt, Rivers State, a hot spot for such harassments and intimidation in Nigeria.

The lady noticed that her bank account had been frozen. Innocently she went to GTBank to lay a complaint. Customer Care, after some vague English, handed her over to security. The bank wasn’t satisfied with her explanation that she simply sold bitcoin to a man from the north who paid using a bank account he claimed was his.

Security handed her over to police. Zoomed off in a Van, she spent one night in detention in Port Harcourt. The next day, the police were going to hand her over to the Police Command in a northern state.

To stop that from happening, her friend reached out to us in SiBAN. We got in touch with a Port Harcourt based lawyer to intervene. It was difficult. The police were too enthusiastic about handing her over to their northern brothers. Someone was making that happen behind the scenes. To cut it short, she got out of the net. The money involved? You won’t believe it: N54k. That’s about $150!!!

I strongly advise that crypto traders are extremely careful. So far, I see a pattern: A bank account customer reports a strange transaction to his bank or the police. The Police instruct the bank to freeze or restrict your account, which is by the way unlawful in Nigeria. The bank patiently waits for you to visit the bank to complain about your frozen account. If you eventually do, your bank hands you over to the police your tax money goes to. The police transport you overnight to the city where the affected bank account customer is. Things happen so fast: You are a fraud. No one cares to investigate anything. As long as you are a crypto trader or dealer, you are a scam. Without good lawyers, your future may just end there.

Here’s a recent case SiBAN intervened in. Please read the story to understand the pattern these risky crypto transactions take. This was N4.5m. https://siban.org.ng/after-65-days-in-detention-bitcoin-trader-regains-freedom-as-siban-intervenes/

A bank has no power to freeze or restrict your bank account for any reason without a freezing order obtained from a competent court of law in Nigeria. What our law enforcement agencies mostly do is bypass the court by simply ordering the bank to go ahead to freeze. And like zombies, most of these banks go-ahead to freeze, because you are not a Senator like me!

So ladies, just avoid crypto guys who are in black Benz painting the town red. You will be better off with a Senator like me!

Faith: Just one question since I haven’t asked. Is there any hidden truth behind cryptocurrencies investment and trading as to why the government do not find it ideal to place it as legal already?
What could be the fears of the government and also people that have plans of venturing in it but end up going back probably because the image portrayed is seen as a scam or not trusted

Senator: 1. Power: Currency is power. In political science, we speak of sovereignty, the supreme power of a state. The state’s control without control over money will be no control. In the evolution of money, we started with the barter system. During that era, communities were more powerful than governments. Why? Simple, money was decentralized. Then money became a precious metal, gold, and now note. As we moved from one phase of money to another, the government became powerful and powerful, leaving communities to the mercy of the government. Decentralized currencies are the next and only phase of money that is taking money back the community, this time in decentralized networks. Government, faced with imminent powerlessness, will and must fight back. While the blind ones keep holding on to fiat (paper), the less blind ones are transiting to central bank digital currencies while destroying decentralized currencies, the seer is preparing a world of both worlds: centralized and decentralized.

2. Consumer protection: Whether we like it or not, every innovation comes with its new risks. It’s not different with cryptocurrencies. The good, the bad, and the ugly are undeniably in this emerging space of ours, just as it also obtains in the fiat space. The government will need to protect the members of the public from bad actors — people who will and are already using crypto innovate to innovate evil. As one with a legal background and one involved in regulatory compliance as well, I must say that this crypto space cannot be left unregulated in someway. The devil you know, they say, is better than the angel you don’t know. I think this consciousness should challenge builders and advocates in the space to innovate responsibly, whatever that means. (Think of drinking responsibly!)

Bright: Following the creation of various Alt-coins, enthusiastic innocent individuals tend to dive into any of them. Are there risks that some of these coins are not authentic? How do we identify such if they exist

Senator: To whom much is given, much is expected.

There are many, many materials newbies and enthusiasts can read up on how to identify authentic coins or tokens. I think @Agbona will be happy to recommend a few links.

Permit me to just say that before jumping on any altcoins, take time to understand what specific problem that altcoin has come to solve, the use cases, the tokenomics, and team. Read independent reviews about them and understand the SWOT. By understanding a coin’s or token’s Strengths, Weaknesses, Opportunities, and Threats, you are minimizing your exposure and taking control of your financial life better. Never outsource learning.

While many enthusiasts understand and appreciate the huge opportunities crypto innovation brings to each of us in an unprecedented way, they often fail to also understand and appreciate that opportunity is a coin with two sides. On the other side is a risk, and such risk can be considerable.

Education. Self-learning. Curiosity. Humility. Continual education. And more education. That’s our responsibility.

Belonging to a community like Beam Africa, for example, helps ‘’iron sharpen iron’’. No one will do your learning for you. The moment you allow that happen, then you must also be ready for wrong judgments. Beware of the bandwagon. The bandwagon is one of crypto/blockchain’s greatest enemies.

Flora: Also, the Nigerian government has recognized agriculture as a saviour to its dying economy.

Has SiBAN thought of creating a structure around agriculture in a bid to incorporate blockchain technology into agriculture?

As they say, two are more likely to work together when they have the same goal.

Could incorporating blockchain technology into the food chain and agricultural practices in Nigeria be one significant way of convincing the government to adopt the blockchain technology?

Senator: This is an interesting contribution. Blockchain in agrotech. It’s certainly worth exploring.

At SiBAN we haven’t engaged the government on the possibility of applying blockchain in the agricultural industry. I think that to do so, we will need to conduct some research to see ways blockchain could be applied in agriculture. One sure way a member of SiBAN, Farmchainville, does it is applied blockchain to food traceability. Farmschainville developed a blockchain-powered ecosystem that ensures traceability and transparency in the entire food supply chain for certain products in Nigeria.

Meanwhile, I will share your suggestion with my colleagues in the SiBAN Exco. Thanks.

Atrick: The difference between Honest Government and Tyrannical Government is the size and age of government.

In the beginning, the small-government has no power and attracts people who want to help and it operates within its financial means.

As time goes on it gains more power and eventually financial corruption from the rich who control everything.

Big government has Great power and it attracts those who thirst for power and complete control.

Crypto takes away the power of control out of the hands of the government and the influence of the powers that be that didn’t originate with government

Senator: I agree with you, Patrick.

Privacy is not synonymous with secrecy for wrongdoing. Inherently, when we speak of privacy, we can’t separate it from safety, security.

Openness may be a big part of transparency, but we don’t have to force everyone to be open.

Rather, we can demand that privacy should be transparent. And by this, I mean that privacy, such as the level of privacy provided by such privacy coins like Beam, is provided in a transparent process — a safety and security process that anyone who cares to know can understand and follow.

But when privacy lacks a transparent process, we then begin to have a cause for worry!

Final Word

It was a highly insightful AMA session with our guest, which enlightened the community on the need to ensure personal safety precautions in dealing with security forces. This AMA opened the door to several opportunities.