The Securities and Exchange Commission of Nigeria is reportedly contemplating permitting tokenized coin offers backed by stock, debt, or property, but “not crypto,” on licenced digital currency markets.
Regulatory Incubation Ahead
According to Bloomberg, the Nigeria SEC is also evaluating proposals for digital trading platforms on an experimental basis, having the intention of subjecting them to a year of “regulatory incubation” with restricted services.
Nigeria SEC to Supervise Services
The Nigeria SEC will supervise the businesses’ suitability to provide services. The head of securities and investment services at the Abuja-based commission, Abdulkadir Abbas stated:
“We always like to start, as a regulator, with a very simple clear proposal before we go into the complex ones.”
No Licensing without Involvement of the Central Bank
According to the article, the SEC isn’t going to start licensing digital asset trading platforms before it has reached a deal with the country’s central bank, which has prohibited local financial institutions from working with crypto service providers.
Nigeria was one of the region’s quickest crypto adopters before the country’s central bank tightened its restrictions.
The current progress may be beneficial for technologically aware people in a country of more than 200 million people with 43% of the population under 14, to local assets such as stocks, which have been avoided for years following the ban of cryptocurrencies and its holders in 2021.
Active Investors in Nigeria
According to a KuCoin study, 33.4 million individuals, or 35% of the adult population, had recently traded or held digital assets. Furthermore, 52% of people have invested more than half of their total wealth in this asset class.
Notably, a CoinGecko poll from August of last year reveals that Nigeria was classified as the country with the highest level of interest in cryptocurrencies worldwide, as TheCoinRise reported. Furthermore, at the end of last year, the West African country was reported to have released a bill that recognises the use of Bitcoin (BTC) and other digital currencies.