Nigeria’s securities regulator establishes fintech unit to check crypto
In 2021, monetary establishments working in Nigeria have been the lever of a authorities crackdown on cryptocurrencies, starting with February’s infamous central financial institution ban on lenders offering providers to crypto exchanges within the nation. With a lot of the Nigerian crypto market of necessity peer-to-peer, Nigeria’s Securities and Exchange Commission (SEC) now goals to introduce laws that would regularize the trade and supply buyers higher safety.
According to a Sept. 2 report, the SEC has established a devoted fintech division tasked with learning crypto and blockchain investments and merchandise – data it might then marshal right into a future crypto regulatory framework. Director General Lamido Yuguda instructed Reuters this week that the company is “taking a look at this market carefully to see how we are able to deliver out laws that may assist buyers defend their funding in blockchain.”
Nigeria’s SEC, which considers that all crypto assets ”are securities, unless proven otherwise,” will only be able to establish a regulatory framework if crypto is once again integrated into the country’s banking system. The agency is also reportedly looking to work with fintechs to strengthen the domestic market for securities to dissuade capital flight, which continues to beset multiple sectors.
Crypto’s exclusion from banking channels has not dampened enthusiasm for the asset class. On the contrary, in a year fraught with political and economic crises, including social and economic repression and rampant inflation, crypto adoption has continued to grow.
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The Central Bank of Nigeria (CBN) is also partnering with a Barbados-based fintech as a technical partner for its proposed e-naira digital currency, preliminary guidelines issued in August. At a meeting of the country’s Monetary Policy Committee in Abuja this spring, CBN Governor Godwin Emefiele expressed his confidence that cryptocurrencies like Bitcoin (BTC) will eventually be legal in the country but stressed that the government would do its best to prevent them from being used to finance illicit activities.