Nigeria’s head of the Securities and Exchange Commission (SEC) has said he plans to upgrade and roll out additional rules to combat illegal trading in digital assets in the country’s cryptocurrency industry.
According to Reuters, SEC Director-General, Emomotimi Agama, told leading blockchain and cryptocurrency institutions on Tuesday that he plans to upgrade rules in their industry, saying that the naira needs to be delisted from peer-to-peer trading to avoid manipulation.
This follows the backdrop of news that the Federal Government intends to start charging domestic money transfers to tackle cyber security.
“I want to seek your co-operation … as we roll out in the coming days the regulations that would take control of these areas,” SEC chief said.
Nigerian officials have clamped down on cryptocurrency activities, blaming users for manipulating the country’s local currency and weakening it.
The Nigerian currency has dropped significantly in strength due to a shortage of dollars while the crypto industry in the country has flourished.
Nigeria is one of the biggest markets in Africa for crypto trading and is mainly used by its young generation of nationals fueled by the severe lack of dollars to pay for goods and services abroad.
Many remote staff who work for companies abroad also receive their salaries and payment for their services in USDT, a stablecoin pegged to the dollar.
The SEC chief said concerns about the activities of crypto peer-to-peer (P2P) transactions and their perceived impact on the naira exchange to the dollar prompted a collective action and dialogue with the country’s financial ecosystem by the regulatory body he heads.
Mr Agama, however, opined that guidelines for digital asset trading are currently being reworked for proper regulation and will cover activities within the cryptocurrency ecosystem, from wallet providers to exchange platform providers and brokerage services.
What to know
In 2022, the SEC released a set of rules for digital assets, in a bid to try to find a middle ground between an outright ban on crypto assets and their unregulated use. Those rules are now being upgraded by the SEC to match the current financial realities of the country.
- In March, Binance, the world’s largest crypto exchange, said it would stop all transactions and trading in the naira following Nigeria’s crackdown on crypto exchanges.
- Nigerian authorities are also detaining Binance executives over charges of money laundering and tax evasion which the company has challenged.
- Nairametrics earlier reported that Binance CEO, Richard Teng, voiced his opposition against the continued detention of Binance executives, saying that Nigeria is setting a bad precedent for global companies by detaining the firm’s executives.
