Nigeria Allocates ‘Security’ status to Crypto-Assets
By Max Steadman – Cryptocurrency Speculator
Nigeria's Securities and Exchange Commission (SEC) has listed crypto-assets as securities, as authorities intensify their efforts to regulate digital assets and cryptocurrency trading in Africa. The SEC notes that the regulation of crypto-assets is compliant with the country's 2007 investment and securities laws.
The Nigerian SEC released an official statement on Monday (September 14th) that the commission is addressing regulation of the crypto-industry. The SEC also claimed that the proposed regulation aims to encourage crypto buying, market openness and to not impede the emerging technology.
According to the commission, issuers of crypto-assets will need to comply with regulation through an initial assessment. The parties involved will have to report the crypto with the commission if the SEC is not satisfied.
Furthermore, international start-ups that want to operate in Nigeria will have to develop a local base in the region. The Nigeria Securities Regulator issued a tentative statement on the possible nature of its regulatory cryptocurrency operations, asserting that "Any person, (individual or corporate) whose activities involve any aspect of Blockchain-related and virtual digital asset services, must be registered by the Commission and as such, will be subject to the regulatory guidelines.”
In a response to the announcement, Senator Iyere Ihenyen, General Secretary of the Nigeria Technology Association (SIBAN), stakeholders in Blockchain, addressed the positive advancement but continued to raise reservations. He explained that he commends the Government for looking at ‘digital assets as alternative investment opportunities’ but conversely, highlighted what he sees as potentially ‘problematic’. The classification of what constitutes a security or investment is his main worry, stating that ‘the burden of demonstrating otherwise is put on the issuer, which could easily be exploited by regulators and even law enforcement agencies.
He goes on to say that the SEC should have implemented a transparent test for establishing these definitions to ‘save us all a lot time, energy and resources.’
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