After a few weeks of placing a ban on cryptocurrency trading in the country, the Central Bank of Nigeria has agreed to partner with the country’s SEC to study cryptocurrencies further for a better regulation strategy. This comes as a result of the SEC advocating for a look into the industry rather than a complete ban as the cryptocurrency industry is a fast-growing one.
The head, Registration, Exchanges, Market Infrastructure and Innovation Department of the country’s SEC, Timi Agama speaking during a virtual lecture organized by the Association of Capital Market Academics of Nigeria (ACMAN) in Nigeria’s capital Abuja, on Sunday said the roughly $2 trillion cryptocurrency market should not be ignored, but rather better understood.
Agama said although the SEC does not encourage money laundering or any bad practice associated with the use of cryptocurrency, the industry is growing fast and is likely to drain investments from the stock market, hence the need to embrace it and make it work for the country. Speaking on the challenges with crypto, he said:
“Part of the desire of the SEC even in the future is to provide a regulatory framework that will take care of all these challenges that we have seen internationally and the entire world is grappling with in terms of cryptocurrency and digital assets.“
“For us at the SEC and capital market, it is something to look at, the world cannot be moving forward and we will be static, no,” he added.
On the 7th of February, the Central Bank of Nigeria issued a directive to commercial banks to cut off business ties with crypto exchanges and other individuals operating with crypto. This received a lot of criticism from experts and crypto enthusiasts both within and outside the country. Since then, Nigerians who account for a large share of the world’s cryptocurrency trading volume resorted to the use of P2P platforms to trade cryptocurrencies – this made the ban of no consequence.
The SEC understands this and its position is that the industry should be given the best possible regulation to guide its growth as well as give both local and international players a level playing field to grow.