Nigeria is an African country famed for its vast petrol reserves and booming economy. It also recently became a major player in the crypto sphere, having proposed new regulations to control cryptocurrency. Finance Magnates reported that Nigeria’s Security and Exchange Commission (SEC) recently announced it would introduce new regulations for the trade of digital assets in the country. This comes as the country has experienced a boom in cryptocurrency trade and transactions in recent times.
Nigeria’s new regulations hope to better monitor and control the cryptocurrency community and investors by allowing increased oversight mechanisms on the trade of digital currency. No specifics have been released yet with regards to the proposed regulations. However, it is likely that the SEC hopes to define digital assets as “securities”. This will thereby put then under the purview of the SEC and subject to its oversight mechanisms.
Techpoint Africa further reported that the proposed regulations aim to improve ethical standards in the cryptocurrency sphere and provide for more transparency in the field. A statement released by Nigeria’s SEC on 14 September 2020 defined the three-pronged approach the commission hopes to use. These respectively regard safety, market deepening, and providing solutions to problems.
Registration in Nigeria
Furthermore, crypto issuers in Nigeria will need to register their digital assets with the SEC. The issuers must prove to the SEC that their digital assets are securities. They will subsequently have to submit registration papers and then comply with the commission’s regulations within three months. These regulations will apply to crypto exchanges, startups, and individual-run crypto businesses. They could even extend to include foreign and non-resident crypto enthusiasts who have set up shop in Nigeria.
These proposed regulations come as Nigeria’s fellow African country and rising economy South Africa has recently extended its cryptocurrency regulations in a bid to better protect digital assets in that country.