Nigeria’s Securities and Exchange Commission (SEC) has released new rules for digital assets, providing more clarity on trading in cryptocurrencies in the country.
Nigeria’s apex capital market regulatory body, SEC, published the guidelines ‘New Rules on Issuance, Offering Platforms and Custody of Digital Assets’ on its website, thus legalising digital assets such as cryptocurrency.
The new regulations cover the issuance of digital assets as securities, the registration of platforms and digital asset custodians, exchanges and virtual assets service providers.
They 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.
According to the guidelines, SEC defines 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 rules gave guidance on application, registration, moratorium on equity interest, limitations to funds being raised investments limits, among others.
Reacting to the New framework, Owen Odia, Country Manager for Nigeria at Luno, a global cryptocurrency exchange with over 10 million customers worldwide, said his company strongly believes the developments could mark a major breakthrough in not only delivering much-needed clarity and protection for crypto customers but also for businesses.
He said: “Since launching in Nigeria in 2015, we’ve always prided ourselves on consistently adopting an open and proactive approach towards regulation and with the SEC’s new framework, our hope is that our current and potential users will have even greater confidence to trust us with their funds as we strengthen our push to raise the standards of our industry.
“We are well-aware that regulators such as the SEC share this same mission; however, we are also conscious that this is by no means an easy task for them. They have to get to grips with a new technology that very few are yet to understand but it is for this reason why they should continue to collaborate with industry players over the coming months and years.”