Nigeria plans additional regulations against illegal digital asset trading

Emomotimi Agama, director general of Securities and Exchange Commission (SEC), has said that Nigeria is gearing up to implement additional regulations to combat illicit trading in digital assets and ensure that all involved parties are properly registered, according to the head of the Securities and Exchange Commission (SEC).

Agama addressed major blockchain and cryptocurrency associations in Nigeria, emphasizing the need to remove the naira currency from peer-to-peer (P2P) trading to mitigate potential manipulation risks.

His announcement coincided with the central bank's introduction of new charges on domestic money transfers as part of cybersecurity measures.

As Nigeria grapples with currency weaknesses and escalating crypto transactions, authorities have intensified their scrutiny of cryptocurrencies. In 2022, SEC introduced initial regulations for digital assets, aiming to strike a balance between banning crypto assets outright and allowing unregulated use.

Despite being one of the largest crypto trading markets, Nigeria has faced challenges, with concerns over P2P traders' influence on the naira-to-dollar exchange rate prompting calls for collaborative efforts within the financial ecosystem.

Following Nigeria's crackdown on crypto exchanges, Binance, the world's leading crypto exchange, ceased all transactions and trading in the naira. Subsequently, the Nigerian government charged Binance and two executives with tax evasion and money laundering, leading to ongoing legal battles.

Agama revealed that comprehensive guidelines for digital asset trading are currently undergoing refinement to ensure proper regulation, covering various aspects within the cryptocurrency ecosystem, including wallet providers, exchange platforms, and brokerage services.