Nigerian Securities Commission (SEC) to Take Action Against Unregulated Cryptocurrency Firms
Date: 2024-09-11 Author: Oliver Abernathy Categories: IN WORLD
The Nigerian Securities Commission (SEC) is preparing to take action against crypto companies operating without regulation.
The move is aimed at cracking down on firms that fail to comply with the country’s regulatory requirements, SEC Director General Emomotimi Agaba said in a recent interview with local media.
“We will begin taking action against anyone operating in this market without the intention of being regulated,” Agaba said.
Nigerian SEC Begins Issuing Exchange Licenses
While Nigeria has been cautious about cryptocurrencies, the SEC has recently begun issuing licenses to eligible cryptocurrency firms.
Last month, it licensed crypto exchanges Quidax and Busha.
In addition, the SEC announced that five other companies have been granted permission to test their business models and technologies under the SEC’s Regulatory Incubation (RI) program.
These companies include Trovotech Ltd, Wrapped CBDC Ltd, HousingExchange.NG Ltd, Dream City Capital, and Blockvault Custodian Ltd.
The RI program was created by the SEC to onboard companies that had already launched their operations before the publication of rules for virtual asset service providers in May 2022.
The RI program, according to the SEC, is designed to evaluate the business models of digital asset companies and test innovative products, services, and technologies in a controlled market environment under SEC oversight.
However, the country has previously blocked some exchanges, despite reports that platforms like Coinbase remain accessible.
In March, the SEC also introduced guidelines aimed at preventing criminals from registering as crypto operators.
The regulator’s latest moves come amid an ongoing lawsuit involving Binance and two of its executives.
One of the executives, who has been in custody for over six months, is reportedly seeking bail due to a serious illness.
However, Agaba said the SEC’s actions will not hinder innovation but will ensure a safe and regulated environment for the market to thrive.
“We are trying to do all this without hindering innovation because one of our core responsibilities as the SEC is to develop the market.”
Binance’s legal dispute could damage Nigeria’s reputation
In June, the Blockchain Industry Coordinating Committee of Nigeria (BICCoN) expressed concern over the ongoing legal disputes between cryptocurrency exchange Binance and the Nigerian government.
BICCoN, which represents the Nigerian blockchain industry, called for a balanced approach to resolving the issues, noting the potential impact on the country’s blockchain ecosystem and its international reputation.
Ongoing legal battles and the detention of Binance executives have created an atmosphere of uncertainty and risk that could scare off potential investors and partners, according to BICCoN President Lucky Uwakwe.
Recently, US lawmakers French Hill and Chrissy Houlahan visited Kuje Prison in Nigeria, where Binance CEO Tigran Gambaran is being held.
Hill called Gambaryan’s detention illegal and said he is in a “horrible prison,” drawing attention to the health problems Gambaran has been facing in custody.
On June 14, the court ruled to drop tax evasion charges against Gambaryan and Anjarwalla.
However, despite the tax charges being dropped, the Binance CEO still faces a separate money laundering case.
