Nigeria SEC Gives Crypto Firms 30 Days to Register—Or Face Enforcement Action

Nigeria’s Securities and Exchange Commission (SEC) has given cryptocurrency exchanges and digital assets traders 30 days to re-register their businesses—or risk facing enforcement actions.

This announcement is part of Nigeria’s plan to regulate digital assets trading. The SEC said the new registration is aimed at amending its rules on digital assets issuance, offering platforms, exchanges, and custody in regards to virtual asset service providers (VASPs).

“All operating and prospective VASPs are hereby directed to visit the SEC ePortal to complete the application process no later than 30 days from the date of this circular,” the commission said in a statement on its website.

Africa’s most populous country has a thriving cryptocurrency landscape. In 2022, it ranked 11th on the Global Crypto Adoption Index by Chainalysis. A Central Bank of Nigeria’s ban prohibiting banks in the country from facilitating crypto trading was in place at the time.

The country jumped to the second position on the index in 2023, despite the clampdown that lasted more than two years.

Like CBN, the SEC is skeptical of digital assets. In a June 2023 circular directed at a fraudulent company using the name of crypto exchange Binance, it said that cryptocurrencies are “extremely risky and may result in total loss of their investment,”

Its skepticism grew earlier in the year when the Nigerian authorities accused exchanges like Binance of being conduits for money laundering and influencing foreign exchange.

It recently warned against investing in DAVIDO, a meme coin promoted by Nigerian Afrobeats star Davido.

The SEC itself is pivoting towards tokenization and plans to develop a pilot program for a permissioned liquidity pool comprising tokenized bonds and deposits.

Its current push for regulation, it said, is “in line with the current realities.”

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