The Securities and Exchange Commission of Nigeria (SEC) has put forth amendments to the regulations governing platforms offering crypto services, suggesting a significant rise in registration fees for crypto exchanges.
The proposed changes include a substantial increase in filing/application fees and processing fees for digital asset exchanges and custodians.
Amendments Aimed at Clarity and Stakeholder Input
The SEC’s proposed amendments aim to enhance clarity and incorporate feedback from industry stakeholders, particularly following engagements with the Central Bank of Nigeria (CBN). The revisions come as part of ongoing efforts to regulate the crypto sector more effectively and align with recent developments in the digital asset landscape.
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Under the updated guidelines, digital asset exchanges (DAX) also called crypto exchanges, digital asset offering platforms (DAOP), and digital asset custodians (DAC) will face higher financial requirements, with filing/application fees set to increase from $62 (N100,000) to $186 (N300,000) and processing fees surging from $186 to $620. Additionally, registration fees are proposed to rise significantly, from $18,620 (N30,000,000) to $93,102 (N150,000,000), reflecting a 400% increase.
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The SEC also plans to rename the rules and guidelines to encompass a broader scope, transitioning from “New Rules on Issuance, Offering Platforms and Custody of Digital Assets” to “Rules on Digital Assets Issuance, Offering Platforms, Exchange, and Custody,” signalling a more comprehensive regulatory framework.
Industry Concerns and Criticisms
While the SEC attributes these changes to stakeholder input, concerns have been raised regarding the substantial paid-up capital requirement of $310,343. Critics argue that such high fees could favour foreign entities over local firms, potentially creating a disadvantage for domestic players in the crypto space.
Nigeria has witnessed rapid growth in its crypto economy, emerging as a key player in the global digital asset landscape. The country’s regulatory adjustments reflect the evolving nature of the crypto market and the authorities’ efforts to adapt to the changing financial environment.
According to reports, Nigeria’s decision to allow the naira to trade freely in 2023 led to record-high inflation rates, impacting the country’s economic landscape. As Nigeria navigates these financial challenges, regulatory changes in the crypto sector are poised to shape the future of digital asset operations within the country.