Nigeria's President Bola Tinubu has signed a new law enhancing SEC oversight and classifying cryptocurrencies as securities.
Legislative Changes
Nigeria's President Bola Ahmed Tinubu has signed the Investments and Securities Act 2024 into law, classifying cryptocurrencies as securities under the Nigerian Securities and Exchange Commission. The new law replaces the ISA 2007 Act and expands SEC's role in overseeing capital markets, including crypto exchanges. The act also enforces tougher penalties for Ponzi schemes, often linked to the crypto market.
Impact on the Crypto Market
Nigeria's tech-savvy population has increasingly turned to cryptocurrencies to protect against high inflation and the naira's depreciation. According to Chainalysis data, the country has received approximately $59 billion in cryptocurrency value between July 2023 and June 2024. The new law implements severe penalties for Ponzi schemes: up to 10 years of imprisonment and a minimum fine of N10 million (about $6,500) for infringements.
Context and Community Reaction
Since taking office in 2023, President Bola Tinubu has focused on fiscal reforms, including revamping tax administration. The push for regulation aligns Nigeria with other regions like the European Union, which have moved to regulate cryptocurrencies as a means to boost government revenue and reduce the budget deficit.
The regulation of the crypto market in Nigeria is accelerating in line with global trends, providing greater investor protection and financial transaction oversight.
