Nigeria Unveil Digital Asset Regulations, Compliance Program

The Nigerian Securities and Exchange Commission (SEC) has modified the rules regarding digital asset issuance, offering platforms, exchange, and custody.

Although this application process aims to increase compliance, VASPs must do it within 30 days after the circular date.

The SEC sent a formal notice to the public outlining its plans to alter these essential rules. The amendment process aims to improve the regulatory framework by making it more thorough and adaptable to the intricacies of digital asset markets.

The modification

The Accelerated Regulatory Incubation Program (ARIP) is a unique compliance program that the SEC introduced as part of this regulatory revamp. This program allows Virtual Assets Service Providers (VASPs) to comply with the new regulations. It is made explicitly for VASPs.

According to the circular on its website, the SEC has established a unique timeframe for the onboarding procedure, which will enable VASPs to take part in the ARIP.

The SEC ePortal provides access to the onboarding procedure. Although this application process aims to increase compliance, VASPs must do it within 30 days after the circular date.

The SEC I also sent out a strong warning, threatening to take regulatory action against any VASPs that do not follow the guidelines in the circular and crack down on non-compliant ones.

Nigeria SEC’s current actions

The original Rules on Digital Assets Issuance, Offering Platforms, Exchange, and Custody were amended in May 2022 in response to the SEC’s nomination of Emomotimi Agama as its new Director-General.

To reposition the Nigerian market, it is imperative that the government and authorities of Nigeria appropriately regulate the virtual assets industry instead of imposing clampdowns, crackdowns, and shutdowns.

The SEC of Nigeria proposes revising the regulations governing platforms that provide cryptocurrency services in March. The proposal called for an increase in the registration price for cryptocurrency exchanges from 30 million naira ($18,620) to 150 million naira ($93,000).

Nigeria has become one of the cryptocurrency economies with the quickest growth rate in recent years. Regarding the adoption of cryptocurrencies, it will also be the second-biggest economy in 2023. According to the volume of Google searches for “cryptocurrency” or “buy crypto,” Nigeria was dubbed the nation most interested in cryptocurrencies in August 2022.