Nigerian SEC Updates Digital Asset Rules, Introduces Compliance Program for Crypto Firms
Summary:
The Nigerian Securities and Exchange Commission (SEC) plans to revise its rules on Digital Asset Issuance, Offering Platforms, Exchange and Custody to keep pace with the complex digital asset market. They introduced a special compliance program called the Accelerated Regulatory Incubation Programme (ARIP) for Virtual Assets Service Providers (VASPs), warned against non-compliance, and suggested an increase in registration fee for crypto exchanges. This move is a part of attempts to transform Nigeria's rapidly growing crypto market, which was the second largest in terms of crypto adoption in 2023.
The Nigerian Securities and Exchange Commission (SEC) recently revealed plans to modify its rules on Digital Asset Issuance, Offering Platforms, Exchange and Custody. This public notice sealed its intention to revamp these primary regulations. The objective of these changes is to upgrade the regulatory framework, making it capable of addressing the complexities associated with digital asset markets. Amidst these regulatory changes, the SEC launched a unique compliance program, known as the Accelerated Regulatory Incubation Programme (ARIP), tailor-made for Virtual Assets Service Providers (VASPs). It offers an avenue for these organizations to get acquainted with the new regulatory standards. The circular announcing this amendment was made available on the SEC's website, which also set up a special window for the onboarding process, enabling VASPs to join ARIP via the SEC's electronic portal. This application process aims to bolster adherence to regulations, with VASPs expected to complete it within 30 days from the date of the circular. SEC has also issued severe warnings to VASPs stating that it will take firm action against entities failing to comply with the directives set in the circular. This modification of the rules that govern Digital Assets Issuance, Offering Platforms, Exchange and Custody (first issued in May 2022) came after Emomotimi Agama took office as the new Director-General of SEC. Concurrently, it is much needed that the Nigerian government and regulators efficiently control the virtual assets industry rather than implementing clampdowns, crackdowns, and shutdowns in an attempt to transform the Nigerian market. In March, SEC suggested an increase in registration fee for crypto exchanges from 30 million naira ($18,620) to 150 million naira ($93,000). Nigeria stands as a rapidly growing cryptocurrency economy over the previous few years. In 2023, it was rated as the second largest economy in terms of cryptocurrency adoption. By August 2022, Nigeria was labeled as the country most intrigued by cryptocurrency based on the number of Google search entries for keywords such as "cryptocurrency" or "buy crypto".
Published At
6/21/2024 5:15:30 PM
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