SEC vows crackdown on unregulated crypto operators in Nigeria

The Securities and Exchange Commission (SEC) of Nigeria has announced plans to take enforcement actions against individuals and entities engaging in unregulated cryptocurrency activities in the country. Emomotimi Agama, the Director-General of the SEC, made this statement on Sunday, emphasizing the commission's commitment to protecting all investors, including those in the crypto space.

Agama warned that the SEC will not allow any operator to function within the Nigerian capital market without adhering to the established regulations. He urged all participants to play by the rules, stating, "We are certainly going to commence enforcement actions on anyone who wants to operate in this market without the intention of being regulated."

The SEC's announcement comes jusin some days after it granted approval in principle to two crypto exchanges, Quidax and Busha, making them the first and only exchanges currently regulated by the commission. 

Agama noted that the SEC observed a growing interest among Nigerian youths in the digital asset space, prompting the need for a clear regulatory framework to protect investors while fostering innovation.

Nigeria's approach to cryptocurrency regulations has been inconsistent in recent years. In 2021, the Central Bank of Nigeria (CBN) banned financial institutions from facilitating crypto transactions, but the SEC introduced a regulatory framework for crypto exchanges in 2022, indicating a shift towards acceptance of digital assets.

In late 2023, the Central Bank of Nigeria lifted its ban on cryptocurrency transactions. However, it subsequently proposed new regulations in May 2024 aimed at restricting peer-to-peer exchanges using the Nigerian naira, which has led to significant impacts on global exchanges like Binance, prompting the company to announce its exit from Nigeria in March 2024.

The SEC's latest move signals a strong stance against unregulated crypto operators and underscores the need for businesses in the industry to comply with the commission's regulations.