Nigeria could be on its way to becoming the first African country with a comprehensive regulatory framework for the digital currency and blockchain industry. This is after the country’s Ministry of Finance revealed it was working with the securities regulator to formulate policies for the industry.
The revelation was made by Armstrong Takang, the special advisor on ICT at the Ministry, as local newspaper Business Day reports. Speaking during a fintech event organized by the Economist Intelligence Unit, Takang revealed that the two public institutions have been developing a regulatory framework that will govern the blockchain industry in Africa’s largest economy.
The Nigerian government sees great opportunity in digital currencies and blockchain technology, Takang told the conference. It’s therefore laboring to develop regulations that will spark adoption and benefit the innovators and the consumers.
The revelation comes just a month since Nigeria drafted a blockchain and digital currency adoption roadmap. As it was reported, the “National Blockchain Adoption Strategy” seeks to build the future of Nigeria’s economy on blockchain technology, gradually cutting down the over-reliance on oil and gas.
Drafted by the Ministry of Communications and Digital Economy, the roadmap focused on key areas such as regulating the technology, fostering innovation, upskilling and capacity building and international competitiveness.
The Ministry, however, admitted that Nigeria lacked definitive digital currency regulations which derails adoption.
“A legal framework issued by the government has become a paramount factor that would guide and determine the successful adoption of blockchain technology in both the public and private sector,” the roadmap stated.
This lack of regulations is what the Finance Ministry and the SEC are out to change with their latest partnership.
For its part, the SEC recognized digital assets as securities in September. Acknowledging that digital assets provide an alternative investment opportunity for Nigerians, it noted the need for regulations in the industry.
“It is essential to ensure that these offerings operate in a manner that is consistent with investor protection, the interest of the public, market integrity and transparency,” the SEC stated.
Senator Ihenyen, the secretary general of the Stakeholders in Blockchain Technology Association of Nigeria (SiBAN), believes that regulators must formulate policies that seek to build the ecosystem. In a recent post, Ihenyen stated:
“Regulators in Africa must learn to see their roles as ecosystem builders, not just enforcers. This approach will put regulators in a better position to understand the market, understand the place of innovation, how policy can make innovation thrive, and the role of regulation in sanitizing the industry.”