The authorities in Nigeria are reportedly contemplating shortly approving a law to recognize Bitcoin as well as other crypto assets’ usage to make pace with worldwide practices.
Punch Newspapers (a native news agency in Nigeria) reported this news after an interview with Babangida Ibrahim (the Chairman of the country’s House of Representatives Committee on Capital Markets).
Nigerian Authorities to Authorize a Law on Recognizing Crypto Assets Including Bitcoin
The report mentioned that if the bill to amend the Investments and Securities Act 2007 is inked into law the native Securities and Exchange Commission would be permitted to recognize the crypto and the rest of the digital funds to be utilized in the form of investment capital.
Ibrahim emphasized that there is a requirement for the country to remain updated with the latest trends and advancements related to the capital markets.
The chairman disclosed that they need an effective as well as effective capital market to operate in Nigeria. To accomplish that objective, Ibrahim specified, they should adopt worldwide practices. This report is witnessed nearly twenty-four months following the prohibition placed by the country on crypto-related operations in 2021’s February.
At that time, the Central Bank of Nigeria ordered the crypto exchanges operating in the country as well as the rest of such service providers to stop their operations. It additionally directed the banking institutions to close the accounts related to any entities or individuals that were involved in the activities of trading crypto assets.
Former Nigerian President Says the Law Will Just Review CBN’s Scope Instead of Legalizing Crypto
Nevertheless, Ibrahim – who provided services as the president of Nigeria from 1985 to 1993 – stresses that the approval of the latest law does not count as the complete opposite of that decision.
He was of the view that an exclusive move is instead a slight review to check the span of the powers of CBN. He added that it does not deal with removing the prohibition, rather their focus is on checking out the legality.
According to him, this takes into account the things that come within the agenda of their activities in the country. Ibrahim further elaborated on this by saying that when Nigeria initially prohibited crypto it was discovered by CBN that the majority of the respective investors do not even utilize the native accounts.
Thus, the CBN does not consider them in its jurisdiction as it cannot check them in any way.
Apart from the approval of the law to be implemented on the cryptocurrencies including Bitcoin, the law will define the regulatory roles to be played by the Securities and Exchange Commission and the Central Bank of Nigeria on the issues associated with digital currencies, as the report pointed out.
Another reason behind the aforementioned law’s proposal is that the citizens of Nigeria did not show any appreciative interest in the central bank digital currency (CBDC) of the country – the eNaira. Subsequently, the respective project could have an adoption rate of only 0.5% in October, twelve months later than its release.
The endeavors of the country’s government to minimize the crypto operations were also ineffective to a great extent. The adoption of crypto continued to grow after the prohibition in 2021. Between January and August of the previous year, Nigerian residents occupied the spot just after the US in the trading volume of Bitcoin.
