The Nigerian Securities and Exchange Commission (SEC) has launched a new initiative aimed at expediting the registration process of Virtual Asset Service Providers (VASP). According to securities market regulators in the West African country, this new program which serves as an amendment to existing rules aims to adjust the current regulatory framework to adapt to the current complexities of the crypto ecosystem.
Nigerian SEC sets 30-day deadline for VASP registration
Last March, the Nigerian SEC announcement several changes to its rules on the issuance of digital assets, offering platforms, exchange and custody. Notably, the commission subsequently increased the registration fee for VASPs from 30 million naira ($20,161) to 150 million ($100,806), which sparked widespread speculation due to the potential for reduced participation of VASPs. businesses, but also promoted financial stability among VASPs.
In a new memo published on June 21Securities regulators have now unveiled a specific amendment to these VASP registration rules which introduces the Accelerated Regulatory Incubation Program (ARIP).
This program, which is expected to last 30 days, appears to provide an “exclusive” window for all “operational and prospective” VASPs in Nigeria to quickly complete all requirements, thereby ensuring full compliance in all areas.
According to the commission, concerned parties should access the SEC electronic portal to initiate the accelerated regulatory incubation program, as all defaulting VASPs are subject to immediate prosecution by the SEC upon completion of this registration program.
Interestingly, this “confusing” move follows the appointment of Emomotimi Agama as the new Director General of the Nigerian SEC in April. Agama, who took office with a pro-crypto reputation, found himself at odds with stakeholders in a growing crypto industry in sub-Saharan Africa.
More precisely in May, the new DG spear a campaign against the presence of the Nigerian naira on crypto exchanges which the Nigerian government has blamed for the massive devaluation of the currency over the last year. This action led to delisting of the Naira on several exchanges including KuCoin and Binance among others.
Nigeria to Implement Strict Regulations for Crypto Space
In December 2023, the Central Bank of Nigeria survey its two-year ban on banks opening accounts for VASPs in a bid to take a regulatory approach to cryptocurrencies rather than an outright ban.
However, despite this policy reversal, microfinance banks continue appear restricted to facilitate crypto trading transactions. This development, coupled with rising registration fees and the recent ARIP program, appears to indicate that the West African country’s government will take a strict approach in adopting the trade and use of cryptocurrency.
Notably, Nigeria is one of the fastest growing crypto hubs in the world with approximately 22 million people, 10.3% of the country’s population is an active crypto owner.
Featured image from The Cable, chart from Tradingview
