May 20, 2024
CRYPTOCURRENCY: We have sole right to regulate trading in Nigeria — SEC
– By Alison Godswill

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CRYPTOCURRENCY: We have sole right to regulate trading in Nigeria — SEC

 

As the controversy over the use of cryptocurrency continues to linger, the  Securities and Exchange Commission, SEC has disclosed that it has the responsibility to regulate trading on all digital assets, including the currency in Nigeria.

 

The Central Bank of Nigeria (CBN) Circular of February 5, 2021, had previously declared the currency illegal in Nigeria.

 

But in a statement obtained by The Daily, www.thedaily-ng.com, Thursday in Abuja, SEC stated: “recognition of the fact that digital assets may have the full characteristics of investments as defined in the Investments and Securities Act 2007, trading in such assets falls under SEC’s regulatory purview, except proven otherwise”.

 

Continuing, it stated: “The SEC made its statement at the time, to provide regulatory certainty within the digital asset space, due to the growing volume of reported flows. Subsequently, in its capacity as the regulator of the banking system, the CBN identified certain risks, which if allowed to persist, will threaten investor protection, a key mandate of the SEC, as well as financial system stability, a key mandate of the CBN.

 

“In light of these facts, we have engaged with the CBN and agreed to work together to further analyze, and better understand the identified risks to ensure that appropriate and adequate mitigants are put in place, should such securities be allowed in the future”.

 

It also stated: “Consequently, it has become necessary to provide the following clarifications about the implementation of SEC’s Capital Market FinTech Strategy:

 

“I. For the purpose of admittance into the SEC Regulatory Incubation Framework, the assessment of all persons (and products) affected by the CBN Circular of February 5, 2021, is hereby put on hold until such persons are able to operate bank accounts within the Nigerian banking system.

 

“II. The planned implementation of the SEC Regulatory Incubation Guidelines for FinTech firms who intend to introduce innovative models for offering capital market products and services will continue.

 

“The SEC will continue to monitor developments in the digital asset space and further engage all critical stakeholders with a view to creating a regulatory structure that enhances economic development while promoting a safe, innovative and transparent capital market”.

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