Nigeria’s cryptocurrency market has been one of the fastest growing cryptocurrency regions in recent years, yet despite this growth, there appears to be no regulation. report Bloomberg has signaled that a change could finally be on the horizon.
According to the report, the Nigerian Securities and Exchange Commission (SEC) is now looking to regulate the digital currency market as digital asset adoption continues to rise across the country.
Digital Asset Regulation in Nigeria: A New Era?
Bloomberg noted that the country’s Abuja-based regulator plans to issue licenses to virtual asset providers, including cryptocurrency exchanges, starting this month. CEO Emomotimi Agama noted:
The SEC wants to provide a platform where people can do these things and we can get all the information we need. (…) We need to support the youth of this country so that they can achieve the benefits that can be obtained in fintech.
The move to regulate cryptocurrencies comes at a time when the West African nation is experiencing a surge in crypto-related activities, driven by a young, tech-savvy population eager to take advantage of the opportunities offered by fintech.
The SEC’s initiative is part of a broader effort to bring Nigeria into line with other global jurisdictions that have already… Regulatory frameworks implemented for digital assets.
SEC Director General Agama stressed the importance of supporting the country’s youth to reap the benefits of financial technology, noting that the market size is substantial and continues to grow.
Citing data from Chainalysis, Bloomberg revealed that the growing adoption of digital currency in Nigeria is quite evident, especially in its volume, which increased by 9% to $56.7 billion in June 2023 alone.
However, Agama believes this figure represents only a fraction of actual market activity, as many transactions go unreported.
Nigeria’s history with cryptocurrencies
Nigeria has A long history of cracking down on the cryptocurrency industry, such as in Other regionsIn 2021, the Central Bank of Nigeria (CBN) issued a statement banning banks in the region from facilitating any cryptocurrency-related transactions.
The move by the CBN, which cited concerns over market manipulation of the naira (the country’s currency), sparked a series of controversies among cryptocurrency users in the country.
Although they eventually found a way around it, the Nigerian government has moved even further in its offensive to take down the region’s most used digital currency exchange, Binance, by February 2024.
Binance executives faced legal proceedings on charges of contributing to the depreciation of the naira by engaging in speculative activities and failing to pay taxes.
Despite these repressive measures, the country’s crypto community Still Resilientwith growing adoption and continued evasion of government crackdowns on their beloved industry.
Featured image created with DALL-E, chart by TradingView
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