Legislation recognising the use of Bitcoin BTC and other cryptocurrencies to stay up with “global standards” will allegedly soon be passed by the Nigerian government.
Following an interview with the House of Representatives Committee on Capital Markets chairman, Babangida Ibrahim, Punch Newspapers, a Nigerian publication, broke the news on December 18.
The local Securities and Exchange Commission would be able to “recognise bitcoin and other digital monies as capital for investment” if the Investments and Securities Act 2007 (Amendment) Bill was passed into law, according to the newspaper.
Ibrahim emphasised the need for Nigeria to be current with capital market trends and developments:
“As I mentioned previously during the second reading, Nigeria needs a strong and effective capital market. We must be up to speed with international standards to do that.”
The allegation comes nearly 24 months after Nigeria outlawed cryptocurrency trading in February 2021. The Central Bank of Nigeria (CBN) ordered local cryptocurrency exchanges and service providers to halt operations and ordered banks to shut the accounts of anybody found trading cryptocurrency.
Ibrahim, who presided over Nigeria from 1985 to 1993, is adamant that the law’s passage does not represent a reversal of the prohibition but rather a secondary examination of the CBN’s authority:
“We are examining the legality: what is lawful and what is within the parameters of our activities in Nigeria,” the statement reads. “It is not about [the] removal of the prohibition.”
The CBN found that most of these investors didn’t even have local accounts when bitcoin was first outlawed in Nigeria. Therefore, they fall outside of the CBN’s purview. He said there is no way for the CBN to check them because they aren’t using local accounts.
Nigeria’s 2007 Investments and Securities Act will be modified if the legislation is approved.
The bill would specify the Central Bank of Nigeria’s (CBN) and Securities Exchange Commission (SEC) (Nigeria) regulatory functions on topics connected to digital currencies in addition to giving legal recognition to Bitcoin and other cryptocurrencies, according to the article.
The eNaira, the digital currency issued by Nigeria’s central bank, has received little to no attention from Nigerians and only has a 0.5% adoption rate as of October, 12 months after its inception.
As usage grew after the ban in February 2021, the Nigerian government’s earlier efforts to suppress cryptocurrency activities may have also been fruitless.
Nigerians were only behind the United States in Bitcoin trade volume from January to August of last year, and at that time, they were more likely to google “Bitcoin” than anyone from any other nation.
An April research report by CoinGecko revealed that Nigerian citizens were the most interested in cryptocurrencies. It is hardly surprising that Nigerians are curious, given their ongoing efforts to combat extreme inflation and a depressed economy.
To create a crypto-friendly economic zone that would promote companies in the area engaged in the blockchain and cryptocurrency industries, Nigeria recently began early-stage conversations with cryptocurrency exchange Binance in September.