Nigeria Is Passing Bill That Recognize Cryptocurrencies Like BTC
The law is planned because Nigeria’s eNaira has only been used by 0.5% of people a year after it came out in October 2021.
There are rumors that the Nigerian government will soon pass a law that will allow Bitcoin and other cryptocurrencies to be used as a way to keep up with “global practices.”
The Nigerian newspaper Punch Newspapers broke the news on December 18 after talking to the head of the House of Representatives Committee on Capital Markets, Babangida Ibrahim.
The report said that if the Investments and Securities Act, 2007 (Amendment) Bill is signed into law, the Securities and Exchange Commission could “recognize cryptocurrency and other digital funds as capital for investment.”
Ibrahim said it was important for Nigeria to know what was going on in the capital markets:
“Like I said earlier during the second reading, we need an efficient and vibrant capital market in Nigeria. For us to do that, we have to be up to date [with] global practices.”
The report comes almost 24 months after Nigeria banned crypto trading in February 2021. At that time, the Central Bank of Nigeria (CBN) told Nigerian crypto exchanges and service providers to stop doing business and told banks to close the accounts of any people or businesses found to be trading.
But Ibrahim, who was also Nigeria’s president from 1985 to 1993, says that the passing of the law isn’t a 180-degree turn on the ban. Instead, he says, it’s just a second look at what the CBN can do:
“It is not about [the] lifting of the ban, we are looking at the legality: what is legal and what is within the framework of our operations in Nigeria.”
He added that when cryptocurrencies were first outlawed in Nigeria, the Central Bank of Nigeria (CBN) realized that the majority of these investors don’t even utilize local accounts. Therefore, they do not fall within the authority of the CBN. Since they are not using local accounts, the CBN is unable to monitor them.
If the law is passed, the Investments and Securities Act of 2007 in Nigeria will be changed.
In addition to making Bitcoin and other cryptocurrencies legal, the law will explain the roles of the Central Bank of Nigeria and Nigeria’s Securities Exchange Commission (SEC) in regulating digital currencies, according to a report.
The law also comes at a time when Nigerians have shown little to no interest in their central bank’s digital currency, the eNaira. Only 0.5% of Nigerians used the eNaira a year after it was released in October 2022.
Even when the Nigerian government tried to stop crypto activity in the past, it didn’t seem to work, since the use of crypto continued to grow after the ban in February 2021.
From January to August of 2021, Nigeria’s Bitcoin trading volume was second only to that of the United States. During the same time period, Nigerians Googled “Bitcoin” more than anyone else.
According to a study done by CoinGecko in April 2022, Nigerians were also found to be the most interested in cryptocurrencies. Nigerians are still trying to deal with high inflation and a bad economy, so it’s not a surprise that they are interested.
Nigeria has also recently started early-stage talks with the cryptocurrency exchange Binance about creating a crypto-friendly economic zone in September 2022 to help businesses in the area that deal with crypto and blockchain.
