Key Takeaways
- If the Investments and Securities Act 2007 Bill is passed, it would allow Nigeria’s SEC to recognize crypto as capital for investment.
- Last year Nigeria’s central bank banned banks from dealing in or facilitating transactions in digital currencies.
Nigeria is looking to legalise cryptocurrencies and bitcoin in the country. According to local media reports, if the Investments and Securities Act 2007 (Amendment) Bill is passed, it would allow Nigeria’s SEC to recognize cryptocurrency as well as other digital funds as capital for investment.
The reports surged following an interview with Babangida Ibrahim, chairman of the House of Representatives Committee on Capital Markets and Institutions of Nigeria. Commenting on how Nigeria is falling behind crypto regulations, Ibrahim stated, “Like I said earlier during the second reading, we need an efficient and vibrant capital market in Nigeria. For us to do that, we have to be up-to-date global practices.”
The report adds that the law will also outline the regulatory roles of the Central Bank of Nigeria(CBN) and Nigeria’s SEC on matters relating to digital currencies and assets. In 2021, Nigeria’s central bank banned banks and other financial institutions from dealing/ facilitating transactions in digital currencies.
Talking about the ban, Ibrahim noted, “When cryptocurrency was initially banned in Nigeria, the CBN discovered that most of these investors don’t even use local accounts. So, they are not within the jurisdiction of the CBN. Because they are not using local accounts, there is no way the CBN can check them.”
The African country is currently working towards finding a middle ground between a complete ban on crypto assets and their unregulated use. Nigeria recently scored 371 in a Coingecko study that looked at Google Trends data for six searches such as “buy crypto” or “invest in crypto,” making it one of the most crypto-curious countries in the world.
Earlier this year, Nigeria’s SEC published the “New Rules on Issuance, Offering Platforms, and Custody of Digital Assets,” detailing registration requirements for digital assets offerings and custodians and classifying the assets as securities regulated by the SEC. The Nigerian government is also engaged in active discussion with crypto exchange Binance to establish a special economic zone to support crypto and blockchain-related businesses.
