Nigeria’s Securities and Exchange Commission Open to Tokenized Assets But ‘Not C...
source link: https://bitcoinke.io/2023/05/sec-nigeria-open-to-tokenized-assets/
Go to the source link to view the article. You can view the picture content, updated content and better typesetting reading experience. If the link is broken, please click the button below to view the snapshot at that time.
Nigeria’s Securities and Exchange Commission Open to Tokenized Assets But ‘Not Crypto’
According to Head of Securities and Investment Services at SEC Nigeria, digital exchanges that intend to operate in Nigeria will undergo a year of 'regulatory incubation.' During this time, they will offer only basic services that are monitored by the SEC allowing the regulator to study their operations and determine their suitability to operate in the country.
Nigeria’s Securities and Exchange Commission (SEC Nigeria) is considering applications for digital exchanges on a trial basis, Bloomberg reports.
This move is part of an effort to increase market participation in the country despite the restriction of cryptocurrencies by the Central Bank of Nigeria.
According to Abdulkadir Abbas, head of securities and investment services at the Abuja-based commission, SEC Nigeria is considering permitting tokenized coin offerings on licensed digital exchanges that are backed by assets including equity, debt, property but ‘not crypto.’
“We always like to start, as a regulator, with a very simple clear proposal before we go into the complex ones.”
The initiative is seen as one that potentially could attract tech-savvy individuals in Nigeria, where over 43% of the population is under 14, to invest in local assets such as equities which have been largely overlooked in recent years.
Similar initiatives are being tested in other countries as well.
For example, in Singapore, an initiative named ‘Project Guardian’ was launched in 2022 to explore the potential uses of asset tokenization. According to Bloomberg, the pilot is led by DBS Bank Ltd., JPMorgan Chase & Co., and Marketnode Pte, and involves the creation of a permissioned liquidity pool consisting of tokenized bonds and deposits.
SEC Nigeria is in the process of registering fintech companies as digital sub-brokers, crowd-funding intermediaries, robo-advisors, fund managers, and issuers of tokenized coins. However, it won’t register crypto exchanges until there’s an agreement on standards with the Central Bank of Nigeria (CBN). In 2021, CBN ordered commercial lenders not to facilitate crypto transactions, making it difficult for exchanges to operate.
According to Abbas, digital exchanges that intend to operate in Nigeria will undergo a year of ‘regulatory incubation.’ During this time, they will offer only basic services that are monitored by the SEC allowing the regulator to study their operations and determine their suitability to operate in the country.
“By the 10th month, we should be able to make a determination whether to register the firm, extend the incubation period or even ask the firm to stop operation.”
Follow us on Twitter for the latest posts and updates
_____________________________________
_____________________________________
Recommend
About Joyk
Aggregate valuable and interesting links.
Joyk means Joy of geeK