To reduce the possibility of manipulation, the Securities and Exchange Commission (SEC) has demanded that the naira be removed from peer-to-peer systems.
This is an attempt to maintain the integrity of the capital market, eradicate illicit trading from the virtual asset sector, and safeguard the interests of all investors.
During a virtual meeting with the Blockchain Industry Coordinating Committee of Nigeria (BICCoN), the umbrella organization of all significant blockchain and cryptocurrency associations in Nigeria, on Monday, Acting Director General of the SEC, Dr. Emomotimi Agama, made this statement.
Agama declared that the Commission has come as a partner to seek collaboration in ensuring that the capital market community is one that is respected globally for decency and fair play, and that the SEC Nigeria will not hesitate to use all the powers within its mandate to handle issues that are negative and pose a threat to national interest.
The head of the SEC added that recent worries about cryptocurrency P2P traders and their alleged influence on the Naira exchange rate have highlighted the necessity of group efforts and communication within the financial industry ecosystem.
“We expect that everyone will abide by the basic practices as enshrined in the Investments and Securities Act of 2007,” he stated. Some may argue that there are no rules to follow, but keep in mind that some acts taken by participants today may be in violation of the Investments and Securities Act of 2007. As a result, the law is the law regardless of the technology employed.
“However, for specific Digital Asset regulatory regime that many have been calling for, we want to assure you that we are working tirelessly to establish an accommodating regulatory guideline for digital assets. The SEC as your regulator is desirous to work with you by providing a level of assurance that is needed by all that are operating within the rules of the market”.
The Director General (DG) declared that the proposed regulations, which are presently being adjusted based on input from multiple stakeholders, will cover a wide range of activities in the cryptocurrency ecosystem, such as wallet providers, digital asset custodians and fund managers, cryptocurrency crowdfunding, initial coin offerings (ICOs), security token offerings (STOs), initial exchange offerings (IEOs), cryptocurrency exchange platform providers, virtual asset brokerage services, etc. The goal is to make sure that every Nigerian involved in the sector who has the capacity to advance economic development is included, supported, and appropriately regulated.
“I am poised for an innovative digital asset regulatory regime that will sustain Nigeria as Africa’s Digital Asset Powerhouse with diverse solutions like Real World Asset Tokenization (RWA) that will drive wealth and catalyse our capital market. We must explore innovative solutions to this problem and strike the right balance between encouraging innovation and safeguarding our national economic interests. This we will do in a friendly and firm manner, to enable us to achieve the desired result”.
“We have a great market ahead of us and we have the talents and the people to make the market great. Mr. President is concerned about the teeming youths involved in this space and would encourage them to do the right thing and develop an ecosystem that we all will be proud of. It becomes necessary that we do what is right. Manipulations and all forms of activities that undermines our national interest would not be acceptable. It is therefore very important that we know that the SEC by virtue of the Section 13 of the ISA speaks to the regulation of all capital market activities.”
Agama conveyed his appreciation to the leaders of the Blockchain Industry Coordinating Committee of Nigeria (Biccon), which serves as the umbrella organization for all significant blockchain and cryptocurrency associations in Nigeria. He also gave them assurances that the commission is prepared to collaborate closely with all parties involved in the cryptocurrency ecosystem in order to improve Nigeria for the benefit of all citizens.
“With our deep understanding of this industry and the cryptocurrency sub sector, we recognize the importance of collaboration and cooperation in addressing the challenges we face; hence your insights and suggestions are invaluable as we seek to navigate these complexities together. We need your support as much as you need ours.
“On that note, I want to emphasize that we are working on different fronts to sustain decent practices within our market, however, we are here to meet ourselves to know those playing within the sector decently and are open to hearing your suggestions on how we can effectively manage all obscure cryptocurrency trading activities within our jurisdiction p2p inclusive irrespective of the challenge we all know that p2p trading posses. We must explore innovative solutions to this problem and strike the right balance between encouraging innovation and safeguarding our national economic interests. This we will do in a friendly and firm manner, to enable us to achieve the desired result.”
Delisting the naira from P2P exchanges, according to Agama, is one of the things that needs to be done in order to prevent the level of manipulation that is currently taking place. Participants in the cryptocurrency space are urged to be patriotic enough to identify and shame those who are involved in negatively disrupting the markets.
“I want to seek your co-operation in dealing with this as we roll out in the coming days the regulations that would take control of these areas. We want to assure that this management will ensure that people or institution that require registration with the SEC are quickly licenced. We assure you that we will give guidance when necessary and do well to streamline the processes to make it less difficult.
“We ask that those involved in sharp practices that undermine national interest should cease and desist. It is in our interest as a people to protect what belongs to us. We encourage you to reach out to us by naming and shaming the bad actors. Together, I am confident that we can weed out bad actors and harness the immense potential of this progressive technology for the benefit of all Nigerians in tandem with this government’s renewed hope agenda” he added.
During his speech, Dr. Babatunde Oghenobruche Obrimah, the Chairman of the Fintech Association of Nigeria, praised the Director General for his audacious actions and his relationship with the ecosystem. He also promised to collaborate with the DG and provide him with all the necessary support to ensure the virtual ecosystem is sanitized.
In an effort to advance the market, BICCoN suggested the formation of a working group to address the numerous issues facing the cryptocurrency industry.