Tech Regulations & Govt | |
Tech Regulations & Govt | |
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Monday, September 28, 2020 / 06:35AM/Nifemi Taiyese for Proshare WebTV/ Header Image Credit: CoinNewsExtra
Stakeholders at the CoinNewsExtra 2020 forum agreed
that there is a need for clarity in the regulation and standardization of the
Digital Asset Market in Nigeria. Looking at the subject of "Interpretation of
Nigeria's SEC Regulation (Statement on Digital Assets and their Classification
and Treatment) of Cryptocurrency in Nigeria" which brought together experts in
the cryptocurrency marketplace, it was an opportunity to assess the changing
face of the Nigerian crypto market.
Mr. Paul Ezeafulukwe the President of Stakeholders in
the Blockchain Association of Nigeria in his remarks said many people have
fallen victim to scams in the sector, and it was clear that there have been
abuses in the cryptocurrency space which informed the need for regulations.
He called for stakeholders in the cryptocurrency
ecosystem to have regular interfacing with the Securities and Exchange
Commission.
"There are some individuals who do not understand how
cryptocurrency works which are why SEC Nigeria released the policy statement,
that explains the offerings and also provides room for recommendations," he
said.
Ezeafulukwe speaking further said in all fairness, a
policy statement such as the one released by the Securities and Exchange
Commission (SEC) cannot be a blanket statement, it needs to be narrowed down
for the sake of the general public. Such a statement will only cause friction
between industry players and agencies.
He added, "To come up with recommendations, the
players in the Nigerian sector need to look at what other countries who are
vast in the field are doing and adapt it to suit our clime".
The President of the SBAN said it was important to
examine the tax implications of transactions for cryptocurrencies, and how tax
can be imposed on capital gains.
On his part, Mr. Chuta Chimezie the Founder of
Blockchain Nigeria asserted that policies, regulations and standardization are
part of the process for mass adoptions. He highlighted that those in the crypto
space are risk-takers, hence the need to utilize blockchain technology for
which it is designed for.
According to him policymaking and regulations are key
things that need to be put in place in the cryptocurrency ecosystem in Nigeria.
Chimezie also noted that the publication by the Securities and Exchange
Commission was very clear as to who and what can be regulated. He stated that
the digital assets offerings must be registered and subject to regulatory
compliance.
"There has to be a level playing ground for everyone
in the sector, hence the regulation is purely targeted at the service providers
and how the stakeholders in that space interact," Chimezie said.
"There is always a way to bypass laws, however, it
remains important that the ground rules are set by SEC. The baseline rules will
help to caution the influx of foreigners and will also allow foreign investors
to receive a go-ahead from the SEC when entering the Nigerian Business Clime
for Crypto".
According to him, the statement released by SEC
Nigeria now indicates that it is legal to talk about digital assets as a
subject matter in the public domain without being subject to harassment.
The Senior Partner Financial Forensics/ Virtual Assets
Regulatory Advisory, Mr. Adedeji Owonibi, in his remarks said several people
that are organized businesses will only operate in an organized system with
laid down ground rules to avoid confusion; an important reason for SEC stepping
in. He agreed that there was a need for accountability in the cryptocurrency
ecosystem.
"Within the cryptocurrency space, there are different
classifications of crypto assets technology that are backing it. To regulate
the function of activity that cryptocurrency plays the regulators need to
understand the function of the technological assets. Many activities are being
conducted in the space already hence the need for SEC to step in. It is
therefore imperative to provide a standard operating procedure within the
Nigerian business environment" Owonibi said.
He said there is a need to perform detailed
investigations to identify the virtual assets service providers and the
businesses that trade crypto assets.
Speaking further Mr. Owonibi said the policy statement
will help in developing the capacities of the ecosystem in Nigeria. This new
guidelines for him will ensure foreign players present their footprint of
activities in Nigeria to SEC, before gaining the clearance to issue crypto
service to Nigerian citizens.
The financial expert was optimistic that the SEC
statement gives digital assets a positive posture, as asset managers and
corporates can begin to learn more about the opportunities which will open up
the economy as people try out the new asset class.
Mr. Lucky Uwakwe Founder SaBi Groups, believed technology
is a space that is difficult to regulate, and the mechanism to hold people
accountable is not feasible.
Talking from the perspective of an industry player,
Lucky mentions that there are ways for more people to migrate to trading
digital assets in no distant time due to the borderless nature of blockchain.
He acknowledged the statement by the Securities and Exchange Commission
highlighting the fact that mechanisms are being put in place to checkmate the
activities in the industry.
Speaking on the position of SEC Nigeria Uwakwe opined
that it does not stifle technology growth but rather encourages innovation in
the local scene.
Chimezie in his concluding remarks at the webinar
stated that there is no regulation document yet as the rules will be made in
another document to guide the operations of digital assets. For now, the
released document is just a policy statement.
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