The Securities and Exchange Commission (SEC) has released new rules for Digital Assets as part of its effort to regulate digital/virtual assets such as Bitcoins and NFTs.
This is contained in a recently released document titled, “New Rules on Issuance, Offering Platforms, and Custody of Digital Assets” essentially legalizing digital assets such as cryptocurrencies in Nigeria.
Recall when Nairametrics reported the SEC Director-General’s declaration in September 2021 that a department had been established to investigate the crypto market.
Digital Asset Players will now include Digital Asset Offering Platforms (DAOPs), Digital Asset Custodians (DACs), Virtual Assets Service Providers (VASPs), and Digital Assets Exchange (DAX).
The Rules apply to all platforms that support the trading, exchange, and transfer of virtual assets; all issuers and sponsors of virtual/digital assets, including international and non-residential issuers and sponsors; and any operator that aggressively targets Nigerian investors.
Game changer
The new regulation creates roles for different players in the digital asset space, each playing a key role in the new sector.
- The new regulations essentially classify digital assets as securities providing other regulators such as the Central Bank of Nigeria.
- The CBN had in February 2021 banned cryptocurrencies stating that it has “no comfort in cryptocurrencies at this time and will continue to do all within its regulatory powers to educate Nigerians to desist from their use and protect our financial system from the activities of fraudsters.
- The Securities and Exchange Commission (SEC) responded that it “has disclosed that there is no policy conflict between the capital market apex regulator and the Central Bank of Nigeria (CBN) over the ban placed on Cryptocurrency transactions in the banking industry.”
- SEC also stated, “As regards our recent policy pronouncement, it is important to clarify that the CBN circular of…
