According to the Securities and Exchange Commission (SEC), Nigeria has emerged as a major player in the cryptocurrency sector, notably in peer-to-peer transactions.
Dr Emomotimi Agama, Director-General of SEC, revealed this at the start of the 2024 International Organisation of Securities Commissions (IOSCO) World Investor Week (WIW) in Lagos.
The theme for the event is “Technology and Digital Assets, Cryptocurrency, and Sustainable Finance.” Agama, represented by the SEC’s Executive Commissioner of Operations, Mr Bola Ajomale, stated that the crypto market environment remained very volatile, and investor protection was vital.
He disclosed that SEC had developed and released frameworks for regulating Virtual Asset Service Providers (VASPs). According to him, the regulator shall continue to address risks such as fraud, money laundering and market manipulation, while also fostering innovation in a safe and transparent manner.
“Our frameworks balance the need to encourage innovation within a safe, regulated environment while maintaining investor protection. Crypto assets must be subject to clear regulatory oversight that ensures market integrity without stifling growth.
“Through this approach we have created a Regulatory Incubation Programme within which new technologies and digital assets can be tested and approved for public use, “he said.
According to him, the SEC has also created an Accelerated Regulatory Incubation Program to encourage non-registered crypto operators, who are now exceedingly risky and banned, to submit themselves for regulatory scrutiny.
Agama stated that as the framework evolved, enforcement action against unlawful crypto platforms, ponzi schemes, and market abuse will become substantially more severe.
He stated that the focus area of sustainable finance was not just a global priority, but also an urgent issue in Nigeria, as environmental, social, and governance (ESG) factors become increasingly relevant in investment decisions.
The director-general mentioned that as Nigeria celebrates the growth of the Nigerian market, stakeholders must acknowledge the evolving risks. He noted that global markets were interconnected, and Nigeria was not insulated from economic volatility, cybersecurity threats and financial crimes such as fraud and market manipulation.
“We as a unified capital market join IOSCO in our commitment to fostering collaboration across borders to ensure that regulatory frameworks keep pace with these developments.
“You might note that so far, we have demonstrated leadership by implementing progressive regulations to protect investors and ensure market integrity.
“As we embark on this WIW, let us remember that the responsibility for a strong and inclusive market lies with all of us —regulators, market participants, and investors alike.
“We firmly believe in the power of collective action. SEC of Nigeria shall continue to work with all exchanges and stakeholders in the Nigerian capital market.
“This is to ensure that we uphold the highest standards of transparency, fairness, and investor protection,” he said.
In his address, the Chief Executive Officer, FMDQ Group Plc, Mr Bola Onadele, said Nigerian youthful population rank among the top users of cryptocurrency and digital assets in the world, having embraced it.
Onadele stated that in today’s global financial landscape, it was impossible not to marvel at the rapid transformation taking place in technology and digital assets, cryptocurrency and sustainable finance. According to him, Nigeria as an emerging market, also known as the leading financial centres in Africa, is at the forefront of many of these developments in Africa.
He said the Central Bank of Nigeria (CBN) for instance, was among the first to launch its central bank digital currency with the introduction of the E-Naira. Onadele noted that the event organised to commemorate the 2024 IOSCO WIW reflects and reaffirms a shared commitment to three fundamental pillars of the WIW.
These pillars, the FMDQ boss listed as, investors education, protection and financial literacy, in an ever evolving financial market landscape. Onadele stated that FMDQ was proud to align itself with the notion, adding that the values are embedded in everything the Exchange does. He added that FMDQ believes the values are critical to building financial market, that are sensible, transparent and beneficial to all Nigerians.
The FMDQ boss noted that the mission of market leaders, regulators and financial educators was clear. According to him, they must continue to create a financial environment that is at the cutting-edge of global development.
Onadele said that they must also ensure that every investor, regardless of their experiences or background was equipped with the knowledge and tools to make informed decisions.
“As we commenced this WIW of learning and collaboration, aimed at empowering investors to navigate the complexities of modern finance.
“This is a unique opportunity to share insights and engage in valuable discussions on critical developments in the market.
“Your participation is indeed vital in shaping the future of the financial market and ensuring that we not only adapt to changes, but also lead with foresight and innovation,” he said.
