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Missed Opportunities in Nigerian Blockchain Regulation

Blockchain Technology Association of Nigeria (SIBAN)'s Digital Assets Summit 2023 in Abuja, Nigerian digital asset professionals gathered to discuss the future of digital asset regulation in the country.

by Alexander
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Adedeji Owonibi, CEO of Convexity, expressed that the Central Bank of Nigeria (CBN) missed a significant opportunity in 2021 when it severed ties between cryptocurrency exchange firms and local banks. He argues that instead of the ban, the CBN should have formulated a blockchain regulation strategy.

Digital Asset Summit Discussion

During the Stakeholders in Blockchain Technology Association of Nigeria (SIBAN)’s Digital Assets Summit 2023 in Abuja, Nigerian digital asset professionals gathered to discuss the future of digital asset regulation in the country. The panel, titled “The Future of Digital Assets: Regulatory Uncertainty and the Way Forward,” explored the reasons behind the slow progress of digital asset regulation and blockchain policy in Nigeria.

The panel discussion on the Future of Digital Assets at the SIBAN Digital Assets Summit. Source: SIBAN

Adedeji Owonibi praised the National Information Technology Development Agency (NITDA) for its efforts in developing regulatory frameworks for the blockchain and crypto industry. He emphasized that NITDA’s actions represent a crucial step in creating a favorable environment for the sector. Owonibi believes that the CBN should have initiated similar measures in 2021.

Challenges of Decentralization

Preye Itonyo, Deputy Director of NITDA’s Digital Economy Development Department, acknowledged the challenges posed by the decentralized nature of blockchain technology. He explained that this decentralization has contributed to a lack of understanding of blockchain and cryptocurrency concepts in Nigeria, which played a role in the 2021 ban on crypto and traditional finance interactions.

Nigeria has been recognized as having the world’s most cryptocurrency-aware population, with 90% of respondents in a global survey expressing interest in investing in cryptocurrencies in the coming year. However, regulatory measures are needed to enhance security and foster scalability in the industry.

Progress Toward Safety

Preye Itonyo highlighted that the established blockchain policy is Nigeria’s initial step toward safeguarding crypto investors. Additionally, NITDA has formed a steering committee to facilitate the implementation strategies of the national blockchain policy, with committee members including the CBN and the Nigerian Communications Commission.

In conclusion, the discussion at the Digital Assets Summit underscores the importance of strategic blockchain regulation in Nigeria and the need for collaboration among key stakeholders to ensure the safety and growth of the cryptocurrency and blockchain industry in the country.

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