The Nigerian Securities and Exchange Commission (SEC) is preparing to issue its first licenses for Virtual Asset Service Providers (VASPs) as the adoption of digital assets continues to rise.Director-General Emomotimi Agama announced that the commission will begin licensing digital services and tokenized assets starting this month, August 2024.
Agama emphasized that this move will create more opportunities for young people in the fintech sector, given the rapid growth and vast potential of the market. He highlighted the necessity of a formal regulatory framework to organize the sector and make information more accessible. Additionally, Agama warned against the misuse of cryptocurrencies to manipulate the value of the naira.
Nigeria’s cryptocurrency market is currently valued at over $400 million, with projections to reach $52.5 million by 2028. This regulatory push aligns with a new initiative from the Federal Inland Revenue Service (FIRS). Executive Chairman Zacch Adedeji announced plans to introduce new tax laws, including those specifically targeting the Nigerian crypto industry, by September 2024.
Adedeji underscored the importance of regulating cryptocurrencies in a manner that supports economic development. In July 2024, the SEC mandated all VASPs, including crypto companies, to establish offices in Nigeria as part of its Accelerated Regulatory Incubation Programme (ARIP). This directive followed the commission’s decision to remove the naira from all peer-to-peer platforms to combat currency manipulation in the forex market.
Nigeria’s efforts to regulate the cryptocurrency sector are seen as a measure to curb naira manipulation and ensure a more stable financial environment.
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