Some Nigerian cryptocurrency enthusiasts see country’s decision to stop naira trading

Some Nigerian cryptocurrency enthusiasts say the country’s decision to stop trading the naira on cryptocurrency exchanges is likely to worsen the situation for its volatile currency.

In an interview with Rom Ovie, Executive Secretary of the Blockchain Technology Society of Nigeria (SiBAN) Stakeholders Association, he said the official Nigerian narrative that global cryptocurrency platforms contributed to the devaluation of the naira n It’s not practical.

Ovie said Nigeria could effectively regulate the cryptocurrency sector through a framework introduced by the Nigerian Securities and Exchange Commission (SEC) in 2022.

Due to the rapid depreciation of the naira and the resulting high inflation rate of 29.9% for almost three decades, the government has focused on platforms offering cryptocurrency services. These sites have become popular for trading and creating an unofficial value of the naira.

In a recent opinion piece, Ewa Salami, an associate professor at the University of East London, said cryptocurrencies had been unfairly blamed for the decline in the value of national currencies.

She suggested that Nigerian authorities should take a balanced regulatory approach rather than a complete ban, as cryptocurrencies have not been directly linked to currency depreciation despite their association with money laundering and drug trafficking. .

“Nigeria needs a balanced approach to regulation if the industry is to thrive without harming financial and monetary stability. A stable financial system can efficiently allocate resources and manage financial risks. This approach should protect consumers and investors.

Regulations to target cryptocurrency exchanges

Cointelegraph has previously reported on Nigeria’s crackdown on cryptocurrency trading platforms. Nigerian authorities blamed these platforms for the rapid decline in the value of the naira at the start of the year. Binance has come under intense scrutiny and has since faced numerous accusations, including allegations of tax evasion.

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Salami stressed that Nigerian authorities can achieve their goals through regulation and not bans. Leveraging the 2022 regulatory framework established by the Nigerian Securities and Exchange Commission, authorities could require cryptocurrency exchanges to disclose the identities of wallet holders linked to suspicious activities, thereby striking a balance between oversight and innovation.

According to the Associate Professor, global adoption of international standards for crypto assets, such as the recommendations of the Financial Stability Board, would provide a unified solution to concerns raised by Nigerian authorities and other regulators around the world, thereby improving the clarity and consistency. regulating activities on crypto assets.

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