Nigerian SEC Introduces New Program For VASP Registration

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As a researcher with a background in financial regulation, I find the Nigerian Securities and Exchange Commission’s (SEC) new Accelerated Regulatory Incubation Program (ARIP) for virtual asset service providers (VASPs) intriguing. Having followed the development of crypto regulations in Nigeria closely, I’ve noticed the country’s complex relationship with digital assets. The SEC’s latest move is a response to the growing complexity of the crypto ecosystem and an attempt to adjust the current regulatory framework.

The Nigerian Securities and Exchange Commission (SEC) has introduced a new scheme to expedite the registration procedure for providers of virtual assets in Nigeria. As announced by the country’s securities market regulators, this innovative undertaking is designed as an update to the current regulations to better accommodate the intricacies of today’s crypto market.

Nigerian SEC Fixes 30-Day Deadline For VASP Registration

In March, the Nigerian Securities and Exchange Commission (SEC) unveiled new regulations concerning Digital Assets Issuance, Offering Platforms, Exchanges, and Custody. One significant adjustment was a substantial increase in registration fees for Virtual Asset Service Providers (VASPs), which rose from 30 million naira ($20,161) to 150 million naira ($100,806). This modification sparked debate due to its potential impact on business engagement, but it also aimed to strengthen the financial foundation of VASPs.

In a recent memorandum issued on June 21, securities regulators announced a new amendment to VASP registration guidelines. This amendment introduces the Accelerated Regulatory Incubation Program (ARIP) for eligible entities.

For the next thirty-day period, this program offers a unique opportunity for both current and potential Virtual Asset Service Providers (VASPs) in Nigeria to swiftly finish all necessary requirements, thereby ensuring complete regulatory compliance.

The commission recommends that relevant parties take action by accessing the SEC ePortal for the Accelerated Regulatory Incubation Program. Failure to comply with this registration process may result in immediate enforcement actions against delinquent Virtual Asset Service Providers (VASPs) by the SEC.

It’s intriguing that the “perplexing” move comes after Emomotimi Agama’s appointment as the new head of the Nigerian SEC in April. Known for his pro-crypto stance, Agama has encountered opposition from industry players in a burgeoning cryptocurrency sector in Sub-Saharan Africa.

In May, the newly appointed head of the regulatory body took a firm stance against the use of the Nigerian Naira in cryptocurrency transactions. The Nigerian government attributed the significant depreciation of the currency over the past year to this practice. Consequently, numerous platforms such as KuCoin and Binance removed the Naira from their listings.

Nigeria To Implement Stringent Regulations For Crypto Space

In December 2023, the Central Bank of Nigeria ended its two-year restriction against banks managing crypto asset service providers’ (VASPs) accounts. This move signaled the bank’s intention to adopt a regulatory framework for cryptocurrencies instead of imposing an outright ban.

Despite the policy change, microfinance institutions in this West African country seem unable to support crypto trading activities. The combination of this restriction with the increased registration fees and the new ARIP program indicates a firm stance from the government towards the adoption and usage of cryptocurrencies.

Significantly, Nigeria stands out as one of the swiftly expanding cryptocurrency markets globally, with around 22 million individuals – equating to nearly 10.3% of the country’s population – actively participating in this digital financial phenomenon.

Nigerian SEC Introduces New Program For VASP Registration

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2024-06-22 11:41