Digital asset exchanges and custodians now have to pay an application cost of 300,000 naira ($186) instead of the prior 100,000 naira ($62) under the amended requirements.
The Securities and Exchange Commission (SEC) of Nigeria has put out a proposal to revise the regulations governing platforms that provide cryptocurrency services. It suggests raising the registration fee for cryptocurrency exchanges from 30 million naira ($18,620) to 150 million naira ($93,000).
The SEC stated in the revision that it was done in order to bring clarification and take into account recommendations from industry participants, “especially with regard to the recent engagements with the CBN [Central Bank of Nigeria].” On Friday, March 15, 2024, the Nigerian SEC proposed amending the rules that it had originally published in May 2022, which applied to all providers of services related to cryptocurrencies and digital assets.
Digital asset exchanges, digital asset providing platforms, and digital asset custodians will now have to pay an application cost of 300,000 naira ($186) instead of the prior 100,000 naira ($62) under the revised criteria.
Additionally, the processing price increased to 1 million naira ($620) from 300,000 naira ($186). The registration fee has also increased significantly, from 30 million naira ($18,620) to 150 million naira ($93,102), a 400% increase.
The regulations and guidelines will now be known as “Rules on Digital Assets Issuance, Offering Platforms, Exchange, and Custody” instead of “New Rules on Issuance, Offering Platforms and Custody of Digital Assets,” according to another suggested modification.
According to the SEC, the purpose of these changes is to improve clarity and take industry stakeholders’ feedback into account. They also incorporate learnings from recent conversations with the Central Bank of Nigeria.
Some have criticised the 500 million naira ($310,343) paid-up capital requirement, despite the SEC attributing the proposed adjustments to feedback from industry players. They contend that local businesses would be harmed by this hefty tax, which would primarily benefit international companies.
In recent years, Nigeria has become one of the crypto economies with the quickest rate of growth worldwide. In 2023, it ranked as the second-largest economy globally in terms of the uptake of cryptocurrencies. The amount of Google searches for “cryptocurrency” or “buy crypto” in August 2022 led to the conclusion that Nigeria was the nation most interested with cryptocurrencies worldwide.
The Financial Times claims that in June 2023, Nigeria abolished its long-standing currency peg and permitted the naira to trade freely. After then, the nation experienced unprecedentedly high inflation. The National Bureau of Statistics reports that in January 2024, Nigeria’s consumer inflation increased to around 30%, marking the 13th consecutive month of such an increase.