Nigeria to tighten crypto regulation in wake of Binance disputes

The Nigerian Securities and Exchange Commission (SEC) has disclosed plans to introduce new regulations for crypto operators following recent challenges with Binance.

New regulations

The planned regulation would include licensing, registration, and screening guidelines for digital and virtual asset services providers (VASPs). In addition, the new guideline would ensure that malicious actors are not registered as operators within the Nigerian market.

A local media outlet, citing a Mar. 4 notice from the regulator, reported that the SEC expressed willingness to engage with “genuine” digital asset operators. The notice stated:

“The SEC has also developed a new AML/CFT/CPF AML/CFT/CPF onboarding manual for licensing/registration and on-going screening of Digital and VASP beneficial Owners to ensure that criminals are not registered as operators in the capital market. The SEC is ready to interface with genuine VASPs based on these clear rules and regulations.”

The Commission is also cooperating with the Central Bank of Nigeria to ensure additional rules are included in the upcoming regulations.

The Nigerian SEC has introduced several pro-crypto regulations to allow the industry to operate under its purview. Last year, the regulator said it would allow the tokenization of assets like equities, property, and debt within the jurisdiction.

Nigeria vs. Binance

This proposed regulation follows the Nigerian government’s issues with Binance, the largest crypto exchange by trading volume.

Over the past few weeks, the exchange has been accused of exacerbating Nigerian foreign exchange challenges by arbitrarily fixing the rates and profiting from the situation. As a result, the authorities blocked access to its official website and arrested two of its executives. In addition, the government is reportedly considering a $10 billion fine from the crypto platform.

In response, Binance discontinued all its services associated with the naira, the country’s national currency, while promising to cooperate with the authorities in their investigations.

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