Key Takeaways:
- New Regulatory Framework: Nigeria’s SEC is set to introduce regulations restricting the use of the Nigerian naira in peer-to-peer cryptocurrency transactions to prevent potential manipulation.
- Impact on Crypto Exchanges: The regulations will target crypto exchanges, custodians, and other industry players, reflecting Nigeria’s ongoing crackdown on cryptocurrency operations.
- Recent Legal Actions: The regulatory developments follow significant legal actions, including the February ban of Binance and the arrest of key executives on charges including tax evasion and money laundering.
In an effort to tighten its grip on the cryptocurrency sector, the Nigerian government is gearing up to impose new regulations that will prohibit the use of the national currency, the Nigerian naira, in peer-to-peer (P2P) cryptocurrency transactions.
The Securities and Exchange Commission (SEC) of Nigeria announced that it will introduce a new regulatory framework targeted at crypto exchanges and custodians, along with other players in the industry, within the next few days. These developments were first reported by Bloomberg on May 7.
ICYMI: Nigeria plans to ban peer-to-peer (P2P) crypto trading, citing national security concerns. This regulatory shift follows the NSA's classification of crypto trading as a threat. Fintech firms like Moniepoint, Paga, and Palmpay face disruption…https://t.co/uuTT9RLF1E
— BSCN (@BSCNews) May 6, 2024
Emomotimi Agama, the Director General of Nigeria’s SEC, highlighted that the forthcoming regulations are designed to remove the naira from P2P crypto exchanges.
This move aims to safeguard the local currency from potential manipulation.
Agama emphasized the urgency of this action, stating, “Recent concerns regarding crypto P2P traders and their perceived impact on the exchange rate of the naira has underscored the need for collective action.”
This regulatory push follows closely on the heels of actions taken against major global crypto platforms.
Earlier this year, in February, the Nigerian authorities banned Binance, a prominent cryptocurrency exchange, and arrested key executives including Tigran Gambaryan and Nadeem Anjarwalla.
The arrests occurred under charges of tax evasion, currency speculation, and money laundering.
JUST IN: After an important meeting set for Monday between the Securities and Exchange Commission and operators in the digital asset industry, there is a possibility that the Federal Government might contemplate suspending the $56.7 billion peer-to-peer cryptocurrency market. pic.twitter.com/Rl5fms0UD3
— Nigeria Stories (@NigeriaStories) May 5, 2024
Gambaryan is currently detained at the Kuje correctional center in Abuja, with his trial set for May 17.
As Nigeria positions itself to navigate the complex landscape of digital currencies, these regulations mark a significant step in its broader strategy to control cryptocurrency activities within its borders.
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