Nigeria's SEC announces regulatory sandbox for crypto firms

The country’s capital market regulator wants to fast-track the onboarding of crypto providers pending the establishment of digital asset rules. 

Nigeria's SEC announces regulatory sandbox for crypto firms
Image: 1000Love via Getty Images Signature/Canva

Nigeria’s Security and Exchange Commission (SEC) has asked virtual assets service providers (VASPs) in the country to register under the Accelerated Regulatory Incubation Program (ARIP).

It wants to fast-track the onboarding process for these companies by granting them interim approval through ARIP pending the time its digital asset rules become enforced. 

The details

  • In a circular dated June 21, the SEC said it is currently working on amending its existing guidelines on digital assets in line with present realities in the cryptocurrency world. 
  • In the meantime, it is providing a special window for VASPs to be registered temporarily to allow these companies to receive guidance on the SEC’s regulatory demands and for the commission to better understand the space. 
  • The SEC outlined conditions that these VASPs must fulfill before it registers them under ARIP and gave a 30-day ultimatum for registering. 
  • It set the processing fee at N2,000,000 (roughly $1,350) and declared that it would commence enforcement action against crypto companies that fail to comply within the time stipulated. It set a N20 million (roughly $13,500) fine for any VASP operating without registration. 
  • The SEC added that it hopes the companies it registers under ARIP will smoothly transition into formal registration when the time expires, effectively declaring that registration under ARIP does not automatically transfer to full licensing.

Key quote

  • The SEC said: 
“The Securities and Exchange Commission hereby notifies the general public, that the Rules on Digital Assets Issuance, Offering Platforms, Exchange and Custody is going through an amendment process ... The Commission hereby provides a special window for the onboarding of Virtual Assets Service Providers tagged Accelerated Regulatory Incubation Program.” 

Key background

mb-weekly-icon

Signup for Mariblock Weekly

Stay up-to-date with the latest blockchain developments in Africa

Sent weekly, on Sundays. Read past editions

Already a member?