Nigeria’s Securities and Exchange Commission (SEC) has announced plans to crack down on unregulated crypto exchanges, businesses, and individuals operating in the country.
According to local news agency Nairametrics, Emomotimi Agama, the Director-General (DG) of Nigeria’s SEC, revealed that the country would commence enforcement action on entities attempting to provide crypto services without appropriate regulation.
Agama noted that these measures reflect the SEC’s dedication to safeguarding investors, including those in the crypto sector.
“We are certainly going to commence enforcement actions on anyone who wants to operate in this market without the intention of being regulated. For those that do not want to play by the books, we will not allow them to operate within our space,” Agama said.
Only Two Crypto Exchanges Regulated in Nigeria
The latest announcement comes after the Nigeria securities regulator issued licenses to two local crypto exchanges, Busha Digital and Quidax Technologies.
Agama noted that the recent approval of the two crypto exchanges was motivated by the increasing interest among young Nigerians in digital assets. The official emphasized the importance of establishing a transparent regulatory framework that safeguards investors and promotes innovation.
Agama also revealed that the SEC had received many applications from crypto exchanges. Still, he stated that the number of registered exchanges would be based on their ability to meet the commission’s rigorous regulatory criteria.
He further noted that the SEC’s oversight of crypto assets will involve implementing checks through anti-money laundering and counter-terrorism financing protocols.
According to Agama, crypto exchanges’ operations must be carefully monitored to ensure they do not disrupt the economy.
Lack of Clarity in Nigeria’s Crypto Regulations
Meanwhile, industry analysts agree that despite Nigeria’s rise as one of the significant players in the crypto market, its approach to regulating crypto transactions has been unclear and inconsistent.
In February 2021, the Central Bank of Nigeria (CBN) imposed a comprehensive ban on digital assets by prohibiting all financial institutions from providing services to crypto exchanges.
In December 2023, the CBN lifted the ban on crypto transactions but later introduced regulations set for May 2024 to restrict peer-to-peer crypto exchanges involving the Nigerian naira.
Nigerian regulators have also targeted global exchanges like Binance, which led the company to stop all Nigerian naira transactions.
