According to an executive director working for Nigeria’s securities regulator, the country is currently leading the trend of digital asset regulation in Africa because it is keenly looking into governing the crypto space. The director went as far as providing clarifications regarding the regulatory role that organizations like the Securities and Exchange Commission (SEC) and the Central Bank of Nigeria (CNB) are playing in this process.
Dayo Obisan, an executive director working for the securities regulator in Nigeria, asserted that his country is the top one in Africa to be working on developing rules and regulations for overseeing the growing digital assets space. Obisan said that Nigeria has become one of the leading countries in the world that are looking into this market.
The Securities and Exchange Commission (SEC) is the securities regulator in Nigeria and Obisan said that his organization was dedicated to providing players in the digital asset industry with an operating environment that enables them to prosper, while also ensuring investor protection simultaneously.
The comments from Obisan about the regulation of digital assets by the SEC come just two months after a new set of rules were announced by his organization for governing the use of crypto in Nigeria. Moreover, it also issued rules applicable to virtual asset service providers (VASPs) in the country.
It had been reported that according to the new rules issued by the SEC, cryptocurrencies will be regulated in Nigeria in the same way as securities. Furthermore, the rules also outlined the requirements that would have to be fulfilled by digital asset exchanges, VASPs, and digital asset offering platforms (DAOPs) in order to register themselves in Nigeria.
The comments of the SEC director come at a time when people are asking questions about which organization should be responsible for the regulation of cryptocurrencies. There is confusion between the Central Bank of Nigeria (CBN) and the SEC.
According to some players in Nigeria’s digital assets space, there have been conflicting statements issued by the two authorities. This makes it apparent that these two organizations do not see eye to eye in regard to the regulation of cryptocurrencies in the country.
Digital assets for investment
Addressing the confusion about the roles of the two regulatory authorities, Obisan stated that even after they had figured out how to classify digital assets, there is still some fungibility in terms of language use, such as cryptocurrency and crypto assets.
He said that the regulatory environment was also evolving and the usage of digital assets can determine how they have to be regulated. He said that when something is used as a fiat i.e. a means of exchange, then it would fall under the regulation of the Central Bank of Nigeria (CBN), but when it is used for investment purposes, then it comes under the authority of the SEC.
Only when the rules are put into effect will their distinction become more evident and help in regulating the crypto space.