FameEX Hot Topics | Nigerian Senate Committee Claims Regulated Crypto Trading Will Strengthen Local Currency

The Nigerian Senate Committee on Capital Markets has advocated for the regulation of cryptocurrency to safeguard investors and formalize the burgeoning digital asset market within the country. The committee's chair, Osita Izunaso, emphasized the necessity of regulation during a recent session where Emomotimi Agama, the new director-general of the Nigerian Securities and Exchange Commission (SEC), was screened.

Izunaso addressed the media, noting that Nigeria's ambiguous stance on cryptocurrency could be detrimental to its financial interests. Despite Nigeria's significant presence in the global crypto market, its regulatory approach has been inconsistent, marked by conflicting positions between the Central Bank of Nigeria (CBN) and the SEC. While the SEC has shown openness to regulating digital assets, the CBN had previously implemented measures to curb their growth.

The situation began to evolve following the departure of former CBN governor Godwin Emefiele, leading to a softened stance from the central bank, including the withdrawal of a directive that had stifled crypto transactions. However, when the Nigerian naira depreciated sharply against the U.S. dollar, authorities targeted alleged currency speculators using cryptocurrencies, indicating ongoing regulatory challenges.

Despite these hurdles, Nigeria remains one of the top five global markets with intense interest in Bitcoin. This backdrop has led Izunaso to propose that President Bola Tinubu's administration should strengthen both the capital and cryptocurrency markets to support the naira. He suggested that enhanced liquidity from these sectors could stabilize the local currency and alleviate economic pressures.

In his remarks, Agama, viewed as a pro-innovation leader, pledged to revitalize the Nigerian capital market. He promised to introduce innovative programs aimed at fostering the development of world-class companies, signaling a potential shift towards more progressive financial policies.

This call for regulated crypto trading underscores a broader recognition of cryptocurrency's potential to influence local economies positively. By aligning crypto regulation with financial innovation, Nigeria hopes to harness these digital assets to bolster economic stability and growth.

Disclaimer: The information provided in this section is for informational purposes only, doesn't represent any investment advice or FameEX's official view.