Nigerians demand clear regulations on digital assets

Calls for a clear regulatory framework in Nigeria are growing louder, with the finance minister joining startup founders, innovators and traders in calling for guidelines from the Securities and Exchange Commission (SEC).

Speaking at the inauguration of the new SEC board, Finance Minister Wale Edun called for a well-defined framework to guide the more than 22 million digital asset owners. The new SEC leadership team is led by Chairman Emomotimi Agama, a pro-Bitcoin leader who the industry believes will be an ally.

“The SEC board should be ready to take on the challenge of regulating these new areas, especially cryptocurrencies, as these are rapidly evolving and complex areas,” Edun said, according to local media.

The minister warned the securities regulator against companies that could take advantage of the situation in Nigeria to engage in regulatory arbitrage and avoid compliance with stringent guidelines.

“Ensure top-notch corporate governance practices, identify and disclose conflicts promptly, and adhere to global best practices. Don’t become a stumbling block for those waiting for processes and approvals,” he added.

Other digital asset industry leaders have joined calls for regulatory clarity. Lucky Uwakwe, who chairs the Nigeria Blockchain Industry Coordinating Committee, urged the regulator to start by defining digital assets.

This has proven to be a challenge that extends beyond Nigeria—even in the United States, the SEC and the Commodity Futures Trading Commission (CFTC) remain at an impasse over whether certain assets are commodities or securities. CFTC Chairman Rostin Benham recently argued to lawmakers that 70% of digital assets are commodities, contradicting his SEC counterpart Gary Gensler, who argued in May that “many of these tokens are securities under the laws of the land.”

Still, Nigeria needs to do more to protect investors and promote innovation, says Uwakwe, whose organization aims to maximize the potential of blockchain technology in Nigeria.

“The Nigerian SEC should remember the need to enact regulations that define the asset class of crypto-assets or divide relevant crypto-assets into asset classes, and also explain to the public how such crypto-assets qualify as securities or commodities,” one of the sources said.

Agama, the new SEC chief tasked with restoring order to a sector that has been dogged by chaos this year, remains hopeful the agency can do just that. Speaking at an event this week where Nigerian academics joined calls for digital asset regulation, Agama called for all stakeholders to work together.

“Collaboration between regulators, industry stakeholders and the public is key to developing effective regulation. I encourage continued dialogue and collaboration to ensure a safe and innovative financial ecosystem,” he said.

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