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Nigerian minister proposes crypto regulation in lieu of clampdown

Nigerian minister of state for budget and national planning Prince Clem Agba calls for fair crypto regulation to welcome further opportunities offered by digital assets despite the government’s strict approach to virtual currencies. 

‘The uncertainty in regulating cryptocurrencies risks denying government and citizens the chance to maximise opportunities from the technology’, Agba expressed according to a report by Bloomberg.

This comment is considered to be prompted by the Central Bank of Nigeria’s (CBN) decision to stop the banks from processing all crypto-related transactions, putting a strain on the overall financial system. As of the moment, the Securities and Exchange Commission which considers digital assets as exchangeable securities, reported that it’s starting to clarify the proposed regulation. 

The minister also questioned CBN’s claim to regulate cryptocurrencies, despite the fact that there are no passing laws giving them the authority to do so.

‘Since our existing laws cannot explicitly stipulate who holds the power to regulate cryptocurrencies, there may be a need for an additional body to play that role’, Agba announced in a conference. 

In addition, Agba stated that better regulation for digital assets will help the national government maximize benefits of blockchain technology. He explained that it is critical for every stakeholder to consider each player as an important teammate, allowing Nigeria to establish a healthier crypto environment.   

Despite CBN’s increasing crackdown on crypto and the uncertainty of regulation, crypto trading continues to operate in the country. News released a report showing that Nigeria had the highest rate of crypto ownership worldwide. 

Along with Kenya, Tanzania, and South Africa, the crypto market in the country has reached a market valuation of approximately US$105,600,000,000 in just a year, according to a report released by Chainalysis in September 2021.

In addition, even after the CBN opposed the legalization of crypto trading, Nigeria introduced its own blockchain-based central bank digital currency (CBDC) called eNaira in October 2021. Completely supervised by the bank, it would help reduce transaction costs and increase citizens’ participation in the institutional financial system.

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