Nigeria is considering a new bill that would recognize cryptocurrencies as capital for investment purposes and outline the supervisory roles of the Central Bank of Nigeria and the Securities and Exchange Commission (SEC) concerning digital currencies.
The Investments and Securities Act, 2007 (Amendment) Bill, if passed, would establish a regulatory framework for various financial activities, including derivatives, commodity exchanges, and digital currencies.
Babangida Ibrahim, the chairman of the House of Representatives Committee on Capital Markets and Institutions, spoke to local media outlets about the bill’s progress but did not provide a timeline for its passing.
Babangida Ibrahim explained that the agency’s decision to review the investment and securities laws is not motivated by a desire to make cryptocurrencies illegal, but rather by the need to establish a regulatory framework for various financial activities, including derivatives, commodity exchanges, and digital currencies.
“It is not that they are illegal but we don’t have regulation for them, So, these are some of the reasons why we need to review the Act and put some regulations for most of these activities.” said Ibrahim.
The announcement comes as interest in cryptocurrencies grows in Nigeria and across Africa, with more people seeking alternative investment opportunities and ways to transfer funds internationally.
Recognizing cryptocurrencies as capital for investment in Nigeria could significantly develop the country’s cryptocurrency adoption and provide a more solid regulatory framework for the industry.
The supervisory roles of the Central Bank of Nigeria and SEC with digital currencies would also be an important aspect of the bill, as it would ensure proper oversight and regulation of the cryptocurrency industry in the country.
This is especially important given the potential risks and challenges associated with cryptocurrencies, such as price volatility and the possibility of fraud or scams.
It is worth noting that in 2017, the Central Bank of Nigeria banned financial institutions from facilitating cryptocurrency transactions due to concerns about the lack of regulation and the potential for fraud and money laundering.
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