Regulation
Recent crackdown on cryptocurrencies in Nigeria regulatory demands
In the current context of Nigeria grappling with inflation rates now approaching 30% and a rapidly depreciating naira, Nigerian officials have turned their attention to cryptocurrency exchanges, accusing them of devaluing the naira. However, this has sparked a debate in the nation’s crypto community.
The Executive Secretary of the Stakeholders in Blockchain Technology Association of Nigeria (SiBAN), Rume Ophi, believes it is misleading to blame crypto platforms for causing the decline of the naira. As an alternative solution, he advocates better rules rather than a total ban.
Iwa Salami, associate professor at the University of East London, mirrored this way of thinking in a comment. She noted that while digital currency may be associated with illicit practices, it has never been responsible for currency depreciation. Salami also calls for fair rules that protect financial stability without killing innovation.
This year, Nigerian authorities have stepped up their efforts, resulting in large companies like Binance investigated and accused of crimes such as tax avoidance and evasion.
According to experts, including Salami, leveraging existing frameworks introduced by the Nigerian Securities and Exchange Commission in 2022 could have a greater impact. These frameworks require exchanges to identify wallet holders involved in suspicious activity, providing oversight and fostering industry growth.