TL;DR Breakdown
- Nigeria’s SEC set to regulate crypto industry in the country.
- SEC says its move is to protect crypto investors in Nigeria.
- Inflation, bad economy continues to push Nigerian to adopt crypto.
Nigeria’s SEC (Security and Exchange Commission), towards formulating regulations for the country’s crypto industry has established a fintech unit for that purpose.
The unit would conduct in-depth research on crypto investment and products towards regulating the digital asset industry. All these are aimed at protecting investors and potential investors coming into the space.
“We are looking at this market closely to see how we can bring out regulations that will help investors protect their investment in blockchain,” Lamido Yuguda, the SEC director-general, said.
He noted that crypto assets in Nigeria are viewed as securities until there’s enough evidence they are not. Yuguda added that the SEC would consider regulation once they integrate cryptos into the Nigerian banking system.
Nigeria’s SEC and crypto regulation
Cryptocurrencies have been widely adopted in the West African country especially among its teeming youthful population prompting the government’s consciousness to act.
Nigeria’s SEC revealed its intention of regulating the crypto space in the country years back, even before the country’s Central Bank banned banks and other financial institutions from providing support for cryptos in any way.
Despite just creating a fintech unit to research the industry, Nigeria’s SEC back in September 2020 said it was well equipped to provide regulatory guidelines for the industry.
At that time, the SEC stated that it was working closely with several institutions, including the world bank, to ensure that the Nigerian crypto ecosystem “is not left barren but guided with basic principles.”
Why Nigerians have been rushing to adopt crypto
The African country, despite its rich natural resources, which includes Oil, Coal, Gold, Bitumen, among others, has been plagued with economic recession, corruption, and bad leadership.
The youths are unemployed, and the country’s currency continues to fall against the USD. Cryptocurrencies have provided Nigerian youths a haven to earn more money and also hedge against inflation experienced in the country.
Chainalysis, a crypto analysis firm, recently released a research report on crypto adoption globally. It revealed that Nigeria is the sixth country with the highest crypto adoption globally.
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