SEC to develop enabling regulation for digital assets
The Securities and Exchange Commission (SEC) has acknowledged the emerging importance of digital assets like crypto assets and committed itself to leading efforts towards developing efficient regulatory framework for the digital assets segment.
Director-General, SEC, Mr. Lamido Yuguda made the commitment at the joint session of the Senate Committee on Banking, Insurance and other Financial Institutions, Capital Market and ICT and Cyber Crime in Abuja.
He said SEC was committed to enhancing financial inclusion in the country through technology.
According to him, SEC recognises the disruption of FinTech in the financial industry and aims to create an enabling regulatory environment that would ensure a balance between investor protection and technological advancement.
He said SEC believes that FinTech would not only bring about efficiency to the capital market but would also serve as a veritable tool for advancing Nigeria’s financial inclusion agenda.
He, however, noted the need to develop an appropriate regulatory framework to ensure the safety of innovation to investors and preserve market integrity.
He said the SEC will advance efforts towards developing a comprehensive regulatory framework that ensures that operators in the crypto asset space conduct their activities in a manner that protects investors and maintains financial system stability.
“The SEC will continue to monitor developments in the digital asset space and further engage and collaborate with all critical stakeholders, including the Central Bank of Nigeria (CBN), to create a regulatory structure that enhances economic development while promoting a safe, innovative and transparent capital market,” Yuguda said.
He outlined that in the United Kingdom, the Financial Conduct Authority (FCA) requires firms that carry on specified activities, by way of business, involving a crypto asset, to be authorized.
Crypto assets are viewed as financial products in South Africa and the Financial Sector Conduct Authority (FSCA) requires persons carrying out associated activities to be regulated. In Malaysia, operators of digital asset platforms are required to be approved by the Securities Commission (SC) as recognized market operators. Several other securities regulators have taken similar positions.
Speaking earlier, Chairman of the Joint Committee, Senator Uba Sani said the committee was on a fact- finding mission in the interest of Nigerians and the nation’s economy.
Sani said the committee would look at enabling laws in line with global best practices.
“We shall look at the position of the CBN who have said cryptocurrencies are very volatile and support insurgency. The Senate will always support innovation and the effective use of ICT for economic empowerment.
“We are aware of the damage it has done and are poised to protect our economy and ensure that our people benefit where necessary,” Sani said.