May 16, (THEWILL) – Nigeria’s Market regulator, the Securities and Exchange Commission (SEC), has issued new rules for digital assets, providing more insight on cryptocurrency transactions in the country.
Earlier in February, the Central Bank of Nigeria (CBN) had ordered all banks to close any accounts dealing in cryptocurrency. But that hasn’t stopped crypto from thriving in the country, with investors turning to peer-to-peer trading or direct payments.
However, SEC published the guidelines tagged ‘New Rules on Issuance, Offering Platforms and Custody of Digital Assets’ on its website, which experts say will open a floodgate for trading in cryptocurrency and other digital assets.
The new rules touched issues around the issuance of digital assets as securities, the registration of platforms and digital asset custodians, exchanges and virtual assets service providers.
According to the Exchange, the rules apply to all platforms that support the trading, exchange, and transfer of virtual assets; all issuers and sponsors of virtual/digital assets, including international and non-residential issuers and sponsors; and any operator that aggressively targets Nigerian investors.
In the guidelines, SEC defined Digital Assets as a digital token that represents assets such as a debt or equity claim on the issuer; Securities Token Offering as any offering and sale of digital tokens that are considered securities; and Digital Assets Offering (DAO) Platform as an electronic platform controlled by a DAO operator that hosts a DAO.
The rule also gave guidance on application, registration, moratorium on equity interest, limitations to funds being raised, investments limits, among others.
To stakeholders, the move by SEC is capable of engendering a major breakthrough in cryptocurrency trading and transactions amongst customers and businesses generally.
Meanwhile, SEC had in September, last year established a specialist fintech division to study crypto investments and plot a course for regulation of cryptocurrency.
Since then, the Exchange has been studying the market closely to see how they can bring out regulations that will help investors protect their investments.
About the Author
Anthony Awunor, is a business correspondent who holds a Bachelor of Arts Degree in Linguistics (UNILAG). He is also an alumnus of the Nigerian College of Aviation Technology (NCAT), Zaria Kaduna State. He lives in Lagos.
