The Federal Government may consider the suspension of the $56.7 billion peer-to-peer cryptocurrency market after a crucial meeting between the Securities and Exchange Commission (SEC), and digital asset operators scheduled for Monday.
Nigeria’s volume of crypto transactions grew by nine per cent year-over-year to $56.7 billion between July 2022 and June 2023, according to the 2023 Geography of Cryptocurrency Report by Chainalysis, a United States of America-based international blockchain analysis firm.
SEC’s latest move signals a broader effort by the Federal Government to tighten regulatory oversight within the cryptocurrency space amidst growing concerns over illicit activities and the manipulation of the naira exchange rate.
Earlier last week, the Central Bank of Nigeria (CBN) stopped major fintech firms from onboarding new customers in an ongoing audit of their Know-Your-Customer process. Following the regulatory action, major fintech firms, including Opay and PalmPay, sent emails to their customers on Friday, warning them against trading in cryptocurrency or any virtual currency on their apps, and threatened to block any accounts found engaging in such activities.
The threat to block accounts has faced heavy criticism, particularly from the 33.4 million individuals actively trading cryptocurrencies; many of whom rely on cryptocurrency trading as their primary source of income.
However, Sunday PUNCH learnt that during the proposed Monday meeting, the government may choose to announce a temporary halt in the P2P crypto trading to enable it come up with a comprehensive set of rules for effective regulation of the space.
Other sources privy to the meeting said the government might choose to engage the crypto stakeholders on a new set of rules that could be deployed to better regulate the space.
They ruled out the possibility of imposing a temporary halt on P2P crypto trading. As of Sunday, details of the exact decision the government might take during or after the meeting with the crypto operators remained sketchy.
However, operators in the crypto market confirmed the meeting, saying the meeting would bother on the current development in the space. In a notice posted on its X handle on Saturday, the Blockchain Industry Coordinating Committee of Nigeria (BICCoN) noted that the meeting had been at the instance of the new Director General of the SEC, Dr Emotimi Agama.
BICCoN said: “The newly appointed Director General of the Nigeria Securities and Exchange Commission has proposed an industry-wide meeting with the Nigeria blockchain community. The meeting will be facilitated by the Blockchain Industry Coordinating Committee of Nigeria”.
Officially, the SEC has yet to confirm the Monday meeting, but sources close to the commission confirmed the meeting on Saturday. They, however, said that ‘nothing was cast in stone yet’.
In 2021, the CBN had restricted banks and other financial institutions from operating accounts for cryptocurrency service providers. However, in December 2023, the financial regulator lifted the ban and announced a reversal of the policy.
Fresh concerns emerged in February over the activities of the largest cryptocurrency exchange in the world, Binance, on its peer-to-peer platform, such as implementing a price cap on USDT trading.
Source: Sunday PUNCH
