After much anticipation, further law for recognizing crypto as means of investment has been drafted and sent to the Senate for approval.
The said legislature was pending submission before the Senate for a long inappropriately which seemed deliberate because the launch of the e-Naira was anticipated.
Another Step towards Legalization of Crypto
The said law is an amendment bill that aims at altering the existing legislation called “Investments and Securities Act, 2007”.
Under the said bill, the country’s lawmakers focus on laying out unique crypto for encouraging the adoption of digital assets in Nigeria.
If the law is approved, then it shall validate the adoption of cryptocurrencies by a population consisting of more than 200 million Nigerians.
Nigeria is currently one of the top countries in the world in terms of crypto adoption. However, in recent times, crypto growth was mulled over by the Government and national institutions such as the Central Bank of Nigeria (CBN).
Yet, Nigeria remains the top adopter of cryptocurrencies on the continent.
Importance of Crypto Recognition as Investment Capital
Presently, the Securities & Exchange Commission (SEC) of Nigeria does not regard digital currencies and assets as sources of investment.
This is the main reason why an amendment has been sought in the existing Investment and Securities Act.
Through the amendment, digital assets will be given legal status and SEC will treat them as ‘investment source’ or ‘capital for investment’.
However, for achieving this end, passing the proposed bill is indispensable.
Senate Members Commented On the Bill
Babangida Ibrahim, who is the Chairman of the Senate Representative Committee, told local media that the proposed bill is the ‘topmost priority’.
Ibrahim was of the view that amendment would describe the duties and obligations of CBN and SEC with regard to digital assets.
He further clarified that the bill does not mean that a free hand is given to the crypto industry to do as it pleases.
Instead, he suggested that authorities in Nigeria shall continue to monitor crypto actively strictly and more efficiently than ever before.
Nigeria Must Ensure Keeping Up With the Rest
He then acknowledged that Nigeria is falling behind other nations that have already laid down crypto regulations and procedures. Ibrahim insisted that Nigeria should move side by side with regional as well as global states.
Meanwhile, a state-owned export authority called Nigerian Export Processing Zones Authority submitted a proposal for establishing a ‘virtual free zone’.
The authority is of the considered view that a virtual free zone would encourage economic stability and growth at the national level.
In this connection, the authority recommended entering into a public-private partnership with the world’s leading crypto firm, Binance. However, the Government hasn’t considered the proposal yet nor made any comment.
Causes of Delay in the Submission of Amendment
The amendment was supposed to be submitted for approval a year ago, however, at the request of CBN, it was deferred.
CBN, which was working on an e-Naira project (i.e. CBDC) opined that if crypto is legalized it would jeopardize e-Naira’s adoption.
It was hence decided to pending the amendment and proceed on with the launching of the e-Naira.
E-Naira has accordingly launched a while ago, however, the project did not succeed as the participation was nothing as had been expected.
After e-Naira’s failure, there was no point in deferring the bill unnecessarily. It is hoped that the amendment, if passed, would also benefit the e-Naira, particularly in its mass adoption.
With the e-Naira being adopted on a nationwide level, its success will be ensured. Nigeria will emerge as one of the countries that have already launched their e-Naira in the mainstream market.
The country is eager to break out of the low economy chains. The locals in Nigeria want to have a lifestyle that has a high standard.
For them, the digital assets industry has the potential to help them achieve their goal. Their trust is decreasing in the traditional financial sectors and has shifted to the digital finance sector.