Experts are calling for the SEC and CBN to give clearer directives on cryptocurrencies in Nigeria. With more comprehensive regulation created by authorities in the nation, the adoption of cryptocurrency in Africa’s biggest economy could increase even more.
According to former Secretary General, Independence Shareholders Association of Nigeria, Adebayo Adeleke,
“As long as investors have confidence or assurance, provided by the regulators, people will begin to embrace it as an alternative investment.”
“If our own regulators like the SEC put a framework in place, and be willing to assuage investors’ anxiety and concern over the safety of their investment, people will begin to invest in the technology.”
Adoption of cryptocurrencies has deepened over the years, opening up new opportunities for Nigerians to achieve financial inclusion and enhance their experiences in making financial transactions. This is due in part to the increased ease of access which Nigerians have to cryptocurrency platforms through their mobile phones.
Despite the heightened trust which the public have in cryptocurrencies, concerns remain about keeping its users secure. While Bitcoin itself is extremely secure, many of the platforms on which it is exchanged lack the uniformity of standards required to ensure that gaps in security are closed.
More collaborative efforts between regulatory bodies could be the key to securing the future of Bitcoin in Nigeria and Africa. An example of the benefits of collaborative efforts in the cryptocurrency space can be found where Interpol worked closely with cybersecurity firm, Trend Micro to mitigate the risks of cryptojacking affecting people across South-East Asia. According to its report, released on 8 January, 2020 the combined efforts have helped to reduce crypto-jacking in the region by 78%.
Research by Chainalysis shows that the percentage of illicit cryptocurrency activity associated with scams isn’t as high in Africa as in other regions around the world. It accounted for only 2% of the region’s $16 billion trading volume between July 2019 and June 2020. For this reason, among others, security may not be the most important factor regulators need to consider when deciding on the future of the industry in Nigeria.