Nigeria's SEC Bolsters Crypto Regulation, Takes Enforcement Actions
Nigeria's Securities Exchange Commission (SEC) is bolstering its regulation of the cryptocurrency sector, collaborating with other agencies and issuing licenses. Meanwhile, enforcement actions have been taken against unlicensed operators.
In October 2024, Paparaxy Global Ventures Limited and Lemskin Technologies Limited were ordered to forfeit N160,000,000 (~$97,500) for providing USDT to Naira exchanges without valid licenses. The Nigeria Economic and Financial Crimes Commission (EFCC) has also charged Afriq Arbitrage System (AAS) and its CEO, Jesam Michael, with investment fraud totaling $844,416.36, $10,000, and ₦590 million. The defendants allegedly solicited public deposits without being a licensed us bank or authorized financial institution.
The SEC began issuing operating licenses to digital asset companies in August 2024. More licenses are expected, but the process is delayed due to thorough due diligence, as reported by SEC Director, General Emomotimi Agama. The SEC primarily collaborates with the Central Bank of Nigeria (CBN) to create a sustainable digital currency framework. In November 2024, the EFCC secured a conviction against Plip Global Ventures for unlawfully conducting USDT-to-Naira transactions without a banking license.
The SEC's collaboration with other agencies and issuance of licenses aim to regulate the cryptocurrency sector effectively. Meanwhile, enforcement actions against unlicensed operators serve as a reminder of the importance of compliance with financial regulations.
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