Following the recent CBN ban of cryptocurrency facilitation in the Nigerian terrain which was met with an expected uproar in the global crypto space, the Nigerian Securities and Exchange Commission (SEC) came out to assure Nigerians that this CBN move does not exactly reflect a “policy conflict” between themselves and the nation’s apex bank of banks.
They pointed out that CBN’s letter to depository banks and other financial institutions does not directly conflict with their September 11 2020 publication as regards crypto assets.
According to the SEC:
” We see no such contradictions or inconsistencies.”
The agency reiterated that crypto assets are digital assets within the regulatory purview of the SEC “except proven otherwise”, the motive behind their September 11 Statement distinguishing crypto assets from cryptocurrencies is not to stifle creativity but to put standards of ethical practices in place, this way investors can play in the securities market with confidence in its fairness and efficiency.
SEC assured Nigerians that it made the Statement last year so as to make sure there is regulatory certainty in the digital asset terrain especially seeing as the sector has become the buzz as of late. Sequel to this, the bank of banks decided to hedge its citizens from its perceived risks which the apex bank notes that if it condones these perceived risks, it may expose heavily invested financiers in the crypto sector and consequently the “financial system stability” according to the CBN.
The agency notes:
“In light of these facts, we have engaged with the CBN and agreed to work together to further analyse, and better understand the identified risks to ensure that appropriate and adequate mitigants are put in place, should such securities be allowed in the future. Consequently, it has become necessary to provide the following clarifications about the implementation of SEC’s Capital Market FinTech Strategy”
It added that:
“For the purpose of admittance into the SEC Regulatory Incubation Framework, the assessment of all persons (and products) affected by the CBN Circular of February 5, 2021 is hereby put on hold until such persons are able to operate bank accounts within the Nigerian banking system.
The planned implementation of the SEC Regulatory Incubation Guidelines for FinTech firms who intend to introduce innovative models for offering capital market products and services will continue.”
Creative Niverians are assured that Nigeria may soon allow the facilitation of these digital properties although in a more regulated and risk mitigating manner.
“The SEC will continue to monitor developments in the digital asset space and further engage all critical stakeholders with a view to creating a regulatory structure that enhances economic development while promoting a safe, innovative and transparent capital market.”
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