Recently, the Nigerian Securities and Exchange Commission (SEC) granted Approval-in-Principle to two local crypto exchanges, Busha Digital Limited and Quidax. This move signifies the SEC’s commitment to promoting innovation while safeguarding investors in the digital asset space. With the Accelerated Regulatory Incubation Program (ARIP) in place, operational firms are being onboarded ahead of the anticipated release of the Rules on Virtual Asset Service Providers in May 2022.
Busha CEO, Michael Adeyeri, expressed his approval of the SEC’s decision, calling it a long-overdue step to sanitize the crypto space for the benefit of the Nigerian economy. He highlighted that the approval would provide local crypto users with secure and regulated platforms for managing and trading their assets. This development is crucial, especially in light of the crackdown on global exchanges like Binance and OKX by Nigerian authorities.
In recent months, the Nigerian government has taken legal action against Binance and compelled OKX to cease operations in the region due to non-compliance with local regulations. This enforcement illustrates Nigeria’s commitment to ensuring that all crypto exchanges, both local and global, adhere to stringent regulatory standards. The SEC’s initiative to approve local exchanges under the ARIP is a step towards creating a level playing field for all players in the digital asset market.
Apart from Busha and Quidax, five other firms have been admitted under Nigeria’s Regulatory Incubation (RI) program. This program aims to assess the business models of digital asset firms and test innovative products in a controlled environment. The inclusion of firms like Trovotech, Wrapped CBDC, HousingExchange.NG, Dream City Capital, and Blockvault Custodian showcases the diversification and expansion of the crypto ecosystem in Nigeria.
The SEC reiterated that the ARIP and RI programs serve as the only legitimate channels for well-intentioned entities to introduce their products in the Nigerian capital market. By obtaining Approval-in-Principle, crypto exchanges and other digital asset firms demonstrate their commitment to transparency, investor protection, and compliance with regulatory frameworks. This regulatory oversight is essential for building trust and confidence among investors in the burgeoning crypto market.
The SEC’s approval of local crypto exchanges under the ARIP marks a significant milestone in the development of the digital asset ecosystem in Nigeria. By fostering innovation, ensuring investor protection, and promoting regulatory compliance, the SEC is paving the way for a sustainable and vibrant crypto market in the country. With the increasing adoption of digital assets, regulatory oversight plays a crucial role in shaping the future of the crypto industry in Nigeria.
Leave a Reply