- Nigeria’s SEC released a new publication stating three conditions for the country’s crypto service platforms
- Crypto products and service platforms must provide a VASP license to the commission before initiating any crypto dealing
- The SEC’s new regulations come after the Central Bank of Nigeria had banned any crypto dealing.
The Nigerian Security and Exchange Commission (SEC) has formulated a new regulatory policy for the crypto ecosystem in the country.
The Nigerian market regulator published a document “ New Rules on Issuance. Offering Platforms and Custody of Digital Assets” which outlines the regulations.
The document outlines the conditions that the digital asset platforms are required to meet. The document also categorizes the digital asset as security that is meant to be managed by the SEC.
The SEC clearly states that digital assets platforms that will be providing crypto services and/ or products in the country must provide a virtual Asset Service Providers (VASP) Licence.
SEC Regulations Signal Crypto Adoption
The SEC regulations that have been introduced signal that the government is slowly allowing crypto trading but only under the regulations.
These regulations came in after the Nigerian government together with the Central Bank of Nigeria had initially banned crypto trading in the country in February 2021.
In 2021 September, Nigeria’s SEC said it would introduce regulations for cryptocurrencies once the government makes it legal for banks to participate in virtual currencies.
Luno Banks the SEC Regulations
Owen Odia, who is Nigeria’s country manager at Luno reported that “ At Luno, we strongly believe today’s developments could mark a major breakthrough in not only delivering much-needed clarity and protection for crypto customers but also for businesses.”
“Since launching in Nigeria in 2015, we’ve always prided ourselves on consistently adopting an open and proactive approach towards regulation and with the SEC’s new framework, our hope is that our current and potential users will have even greater confidence to trust us with their funds as we strengthen our push to raise the standards of our industry,” he adds.
Nigerians are at the forefront of utilizing the Luna exchange platform. Luno secures approximately 4,000 app installments in a day and has over 3 million customers from Nigeria alone. Luno has its platform in Nigeria registered under the Nigerian financial intelligence unit.
Nigeria Joins the Lead in Crypto Adoption
Africa is expected to have robust crypto adoption in 2022. The Gemini report showed that more Africas are planning to buy cryptocurrencies. Nigeria’s crypto regulation comes in just a few weeks after the Central African Republic (CAR) accepted bitcoin as a legal tender.
CAR’s action might have been spurred by El Salvador’s Bitcoin legalization.
Just like El Salvador, the CAR hopes that with Bitcoin as a legal tender the country’s economy will be rescued from severe inflation.
