The proposed law comes as Nigeria’s eNaira has achieved an acceptance rate of 0.5% just over a year after its launch in October 2021.
The Nigerian government is expected to soon pass legislation recognizing the use of Bitcoin
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and other cryptocurrencies to keep up with “world practices”.
The news was published by Nigerian newspaper Punch on December 18 following an interview with House Capital Markets Committee Chairman Babangida Ibrahim.
The report stated that if the Investments and Securities (Amendment) Bill 2007 were passed, the local Securities and Exchange Commission would allow the local Securities and Exchange Commission to “recognize cryptocurrency and other digital funds as investment capital. Investment”.
Ibrahim stressed the need for Nigeria to keep up with trends and developments in the capital markets:
“As I said during the second reading, we need an efficient and dynamic capital market in Nigeria. To do this, we need to be up to date with global practices.
The report comes nearly 24 months after Nigeria banned crypto activities in February 2021, when the Central Bank of Nigeria (CBN) ordered Nigerian crypto exchanges and service providers to cease operations and forced banks to freeze the accounts of individuals or entities to conclude which have been deemed binding. in commercial activities.
But Ibrahim – who was Nigeria’s president between 1985 and 1993 – insists the passage of the law is not a 180-degree inversion of the ban, but rather a secondary test of what lies within the CBN’s powers:
“It’s not about [the] lifting of the ban, we’re looking at legality: what’s legal and what’s within the scope of our operations in Nigeria.”
“When cryptocurrency was initially banned in Nigeria, the CBN discovered that most of these investors were not even using local accounts. They are therefore not subject to the jurisdiction of the CBN. Don’t use local accounts, CBN can’t verify them,” he explained.
If the law is passed, amendments will be made to the Nigerian Investments and Securities Act 2007.
In addition to giving legal recognition to Bitcoin and other cryptocurrencies, the law will outline the regulatory roles of the Central Bank of Nigeria and the Securities Exchange Commission (SEC) of Nigeria on issues related to digital currencies, according to the report.
The law also comes as Nigerians have also shown little to no interest in Nigeria’s central bank digital currency eNaira, which had only achieved an adoption rate of 0.5% in October, 12 months after its launch.
See also: Emerging Markets Lead Global Adoption Index: Chainalysis Report
Efforts by the Nigerian government to crack down on crypto activity earlier have also arguably been ineffective as adoption continued to surge following the ban in February 2021.
From January to August last year, Nigerians trailed only the United States in bitcoin trading volume, and over the same period Nigerians were more likely to google “bitcoin” than citizens of other countries.
Nigerian residents also emerged as the most crypto-curious nation, according to a research study conducted by CoinGecko in April. The curiosity comes as no surprise as Nigerians continue to struggle to combat runaway inflation and economic malaise.
Nigeria recently began preliminary talks with cryptocurrency exchange Binance in September to develop a crypto-enabled economic zone aimed at supporting crypto and blockchain-related businesses in the region.
