By Chukwuma Umeorah
In a latest effort to crackdown on naira manipulators in the foreign exchange market, the Federal Government, through the Securities and Exchange Commission (SEC), has announced plans to delist the Nigerian currency from all Peer-to-Peer (P2P) cryptocurrency platforms.
The Director General of the SEC, Emomotimi Agama, disclosed this during a meeting with the Nigerian Blockchain Industry on Monday. The delisting is expected to be part of a wider regulatory framework aimed at sanitising the cryptocurrency space, which will be rolled out in the coming days.
According to Agama, the delisting is necessary to “save this space” and prevent the ongoing manipulation of the naira’s value. He urged stakeholders in the crypto industry to cooperate with the SEC as the new regulations are implemented.
The SEC’s move comes after the Central Bank of Nigeria (CBN) recently issued a directive to fintech companies, instructing them to warn their customers against engaging in cryptocurrency transactions. This latest development suggests a coordinated effort by Nigerian authorities to regulate the crypto space and address concerns about its impact on the national currency.
Agama stated that the proposed regulatory guidelines which is currently being fine-tuned with suggestions by various stakeholders, will encompass various activities within the cryptocurrency ecosystem ranging from Wallet providers, digital asset custodians and fund managers, Cryptocurrency Crowdfunding, Initial Coin Offerings (ICOs), Security Token Offerings (STOs), Initial Exchange Offerings (IEOs), Cryptocurrency Exchange platform providers, Virtual Asset brokerage services among others, ensuring that every Nigerian playing within the industry with the potential to contribute to economic progress is included, supported and properly regulated.
“I am poised for an innovative digital asset regulatory regime that will sustain Nigeria as Africa’s Digital Asset Powerhouse with diverse solutions like Real World Asset Tokenization (RWA) that will drive wealth and catalyze our capital market. We must explore innovative solutions to this problem and strike the right balance between encouraging innovation and safeguarding our national economic interests.
“We have a great market ahead of us and we have the talents and the people to make the market great. President Bola Tinubu is concerned about the teeming youths involved in this space and would encourage them to do the right thing and develop an ecosystem that we all will be proud of. Manipulations and all forms of activities that undermine our national interest would not be acceptable. It is therefore very important that we know that the SEC by virtue of Section 13 of the ISA speaks to the regulation of all capital market activities.”
He added that the recent concerns regarding crypto P2P traders and their perceived impact on the exchange rate of the Naira has underscored the need for collective action and dialogue within the financial market ecosystem.
According to him, “There are basic practices as enshrined in the Investments and Securities Act 2007 and we expect that everyone will abide by those rules. Some may say there are no rules to play by, but do not forget that we have the Investments and Securities Act 2007 that some actions by participants today may be violating, hence the law is the law irrespective of the technology used.
“However, for specific Digital Asset regulatory regime that many have been calling for, we want to assure you that we are working tirelessly to establish an accommodating regulatory guideline for digital assets.”
One of the measure proposed was delisting the Naira from P2P space in order to avoid the level of manipulation that is currently happening enjoining participants in the crypto space to be patriotic enough to name and shame those that are involved in disrupting the markets negatively.
“I seek your co-operation in dealing with this as we roll out in the coming days the regulations that would take control of these areas. We want to assure that this management will ensure that people or institution that require registration with the SEC are quickly licensed. We assure you that we will give guidance when necessary and do well to streamline the processes to make it less difficult.”
The Chairman of the Fintech Association of Nigeria, Babatunde Obrimah, in his remarks commended the DG for his bold steps and the relationship with the ecosystem and pledged their commitment to supporting him in sanitizing the virtual ecosystem.
On their part, BICCoN requested the setting up of working group to tackle the various challenges facing the crypto space and, in a bid, to move the market forward.