FG Plans to Prohibit Naira from Crypto Trading Platforms Amid Dollar Speculation
The Federal Government, in collaboration with the Securities and Exchange Commission, is preparing to remove the naira from all peer-to-peer crypto platforms as part of its intensified efforts to address exchange rate manipulation and illegal dollar trading.
This decision follows recent moves by the Federal Government to regulate Nigeria’s crypto market, which is estimated to be worth $57 billion.
During a meeting with members of the Nigerian blockchain industry organized by the Blockchain Industry Coordinating Committee of Nigeria, the newly-appointed Director-General of the Commission, Emomotimi Agama, revealed the government’s latest strategy.
Agama affirmed that the government is currently formulating new regulations to oversee the crypto sector.
It has been alleged that operators in the crypto space have been utilizing peer-to-peer platforms to manipulate the naira and the exchange rate.
Agama stated, “Delisting the naira from the P2P platforms is necessary to curb the ongoing level of manipulation. I urge your cooperation as we roll out regulations in the coming days.”
This announcement by Agama comes just a week after the Central Bank of Nigeria instructed payment service banks to warn their customers against engaging in crypto transactions.
It has been reported that some local exchanges in Nigeria, such as OKX and Bitbarter, along with certain platforms under the membership of the Stakeholders in the Blockchain Technology Association of Nigeria, have already ceased naira services in solidarity with the government.
In March, the Blockchain Industry Coordinating Committee of Nigeria sought collaboration with the Federal Government to establish proper regulation after developing the Virtual Assets Service Providers Code of Conduct in 2022.
Despite this, Agama urged members of the Nigerian crypto community to expose and condemn those involved in manipulating the naira, emphasizing the government’s commitment to addressing the issue.
He emphasized, “We must explore innovative solutions to this problem and strike the right balance between encouraging innovation and safeguarding our national economic interests.”
Reports suggest that the proposed meeting on Monday would witness decisive action by the government regarding the crypto sector.
Nigeria’s crypto transactions volume witnessed a nine percent increase year-over-year to $56.7 billion between July 2022 and June 2023, according to the 2023 Geography of Cryptocurrency Report by Chainalysis.
Stakeholders are seeking collaboration with the government to find viable solutions to the challenges facing the crypto space and to advance the market.
In response, the Fintech Association of Nigeria’s Chairman, Dr. Babatunde Obrimah, praised the SEC DG for his proactive steps and expressed the association’s commitment to cooperating with the government to cleanse the virtual ecosystem.
Additionally, the Blockchain Industry Coordinating Committee of Nigeria requested the establishment of a working group to address various challenges and propel the crypto market forward.
Operators within the ecosystem, such as Bitbarter.io’s co-founder Chukwuemeka Ezike, have expressed willingness to support the government’s efforts to resolve issues affecting the naira’s value.
It is anticipated that the meeting will foster cooperation between the industry and regulators to ensure compliance and weed out bad actors exploiting technology for illegal activities.
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