YellowCard, an African-focussed cryptocurrency exchange, is currently seeking approval to broaden its offerings in Nigeria where digital token trading has been partially restricted by regulators.
The company, which has a focus on Africa and currently operates in 16 countries on the continent, has commenced talks with Nigeria’s Securities and Exchange Commission to establish a cryptocurrency exchange, as per Rachael Akalia, the Regional Marketing Manager for West Africa.
According to Bloomberg, the talks slowed but will progress after the SEC releases guidelines on registering crypto firms probably later in 2023.
YellowCard is also said to be engaging the Central Bank of Nigeria on cryptocurrency regulations.
“There is a lot of conversation going on with the regulatory bodies. We are seeing a good feedback,” said Akalia.
YellowCard’s efforts to expand in Nigeria come after over two years since the Central Bank of Nigeria (CBK) instructed financial institutions to shut down accounts involved in cryptocurrency transactions, citing potential risks to the nation’s financial system.
Patricia, a crypto exchange startup was forced to flee Nigeria because of the country’s crackdown.
Despite the regulatory restrictions, Nigerians are still trading cryptocurrencies through peer-to-peer channels online and utilizing platforms like YellowCard and Binance Exchange to transfer tokens.
At present, YellowCard holds a business registration status in Nigeria and provides a restricted range of cryptocurrency services, including buying and selling Bitcoin, as well as Tether’s USDT stablecoin, with the Naira. Additionally, it allows users to conduct other financial transactions via its platform.
According to Akalia, the company is pursuing a license that will enable it to broaden its services which would encompass a cryptocurrency exchange. YellowCard also boasts to be the first company in Africa to get a Virtual Asset Service Provider (VASP) license on the continent, following a regulatory approval in Botswana in October 2022.
YellowCard, which secured a $40 million Series B in late 2022, is also launching a new payments application programming interface, or API, likely in partnership with The Block with a view of a multinational platform for crypto and money transfers. This will allow businesses to collect and disburse local fiat currency while YellowCard handles treasury management, the firm said.
Many Nigerians “use crypto as a platform to hedge their Naira, to save them against devaluation and inflation as well,” Akalia said.
“They come on our platform and buy USDT, store it in their crypto wallet or buy and sell.”
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