Securities and Exchange Commission to license cryptocurrency service providers

Nigeria’s Securities and Exchange Commission is working towards introducing licences for providers of virtual assets, including cryptocurrencies, as part of its strategy to protect investors amid the growing adoption of digital currencies in the country and globally.

SEC Director-General, Emomotimi Agama, revealed on Tuesday that the first batch of licences for digital services and tokenised assets could be issued this month.

“Being a crypto and fintech enthusiast, I can tell you this is going to happen sooner than expected. We must support the youth of this country in harnessing the benefits that fintech offers. The market is vast and continues to grow,” he stated.

He added that this regulatory move aligns Nigeria with other global markets such as the European Union, South Africa, and Botswana, which have already taken steps to oversee the digital asset class.

Reiterating the need for a digital environment, Agama explained that the Central Bank of Nigeria’s ban on banks facilitating crypto transactions was due to concerns over exchange rate manipulation and the naira’s depreciation.

He added that the SEC’s decision underscores the need for a structured environment where digital transactions can be conducted transparently.

Last year, the Central Bank of Nigeria had reversed its stance on crypto assets and instructed banks to disregard the earlier ban on crypto transactions.

Agama noted that the SEC’s aim is to create a regulated platform for crypto activities while ensuring that digital currencies are not used to undermine the naira.

He strsssed that the regulator’s approach will focus on transparency, investor protection, and maintaining stability in the financial system.

In July, the SEC had revealed that crypto firms seeking licences would be required to establish local offices in Nigeria and have their CEOs based in the country.