In Nigeria, where the they prohibut cryptocurrencies, a minister is advocating for policy that supports rather than restricts the use of digital technologies.
Clem Agba is the minister of state for budget and national planning. According to him, uncertainty in regulating cryptocurrencies threatens to deny the government and citizens the opportunity to realize the benefits of the technology.
Agba’s remarks come after the Central Bank of Nigeria ordered commercial banks to halt transacting in cryptocurrencies in February; citing a threat to the financial system it oversees. Meanwhile, the Securities and Exchange Commission is seeking clarification on how they can regulate the asset. SEC considers cryptocurrencies to be exchangeable securities.
Because of the varied classifications of cryptocurrencies as securities or currencies, Agba share at a conference on Thursday that determining who governs them is a challenge.
“Since our existing laws cannot explicitly stipulate who holds the power to regulate cryptocurrencies, there may be a need for an additional body to play that role,” he said.
According to Agba; better regulation should help the government encourage and nurture blockchain technology for more benefits rather than stifle operators.
“It is crucial for all stakeholders to view each player as a key teammate toward a healthy crypto space in Nigeria,” he said.
Agba was speaking at the maiden Technext Conference in Nigeria’s capital, Lagos. Key participants in the African blockchain tech ecosystem as well as crypto enthusiasts attended the event. The participants discussed the prospects of cryptocurrencies in order to position them for future leverage.
Crypto Ban in Nigeria
Nigeria first issued a ban on cryptocurrency in 2017. The Central Bank of Nigeria (CBN) issued another ban in February this year. The CBN informed banks and financial institutions that “facilitating payments for cryptocurrency exchanges is forbidden”. Further, CBN tasked the institutions with the responsibility to identify and cancel accounts affiliated with cryptocurrencies.
Nigerian Digital Currency
Regulatory uncertainty hasn’t deterred Nigerians from investing in digital currencies. According to Statista, the country has the biggest share of such assets per capita in the world. Nigeria’s central bank, the eNaira, joined a growing list of emerging nations in creating its own digital currency. This is in an effort to assist in lower transaction costs and increase participation in the official financial system in October.
President Muhammadu Buhari launched the eNaira earlier this month. The Caribbean-based fintech corporation, Bitt, developed the digital currency. The governor of the Central Bank of Nigeria, Godwin Emefiele, announced at the launch that 500 million eNaira ($1.21 million) had already been coined.
The CBDC’s digital currency app and merchant wallet are currently available for download. The digital money was supposed to be unveiled on October 1st, but that plan was scrapped. Nigeria is one of only a few countries in the world to develop an official digital currency. And it is certainly the first in Africa.