🇳🇬REGULATION | Nigeria SEC Issues a Notice for Onboarding VASPs in 30 Days Due to ‘Current Realities’
Following the 30-day-period, the Commission indicated that it would commence enforcement action against any operating VASP that fails to comply with the directives.… pic.twitter.com/ThvMC4MwFQ
— BitKE (@BitcoinKE) June 22, 2024
Additionally, five firms have been admitted to test their models and technologies under the SEC’s Regulatory Incubation (RI) Program.
The ARIP was introduced to support firms that began operations before the SEC’s Rules on Virtual Asset Service Providers were released in May 2022. Meanwhile, the RI Program is designed to evaluate the business models of digital asset firms and to test innovative products, services, and technologies in a real-time market environment, with close oversight by the SEC.
This latest cohort of ARIP and RI Program participants highlights an increased use of distributed ledger technology (DLT) for creating and trading crypto assets. The results of these tests will guide future policy developments in this area. Testing will be conducted on a short-term and small-scale basis with the SEC working closely with the participating firms to establish testing parameters and robust consumer safeguards.
The ‘Approval-in-Principle’ is a preliminary step toward full registration by the SEC, ensuring that appropriate protection and transparency measures are in place for each product or service.
Participants in the Current Cohort:
- Busha Digital Limited (ARIP)
- Function: Digital Assets Exchange
- Objective: Facilitates the buying and selling of crypto assets with fiat currency, providing investment services through mobile and web applications.
- Quidax Technologies Limited (ARIP)
- Function: Digital Assets Exchange
- Objective: Offers a platform for trading crypto tokens using blockchain technology, with services accessible via web and mobile applications.
- Trovotech Ltd (RI)
- Function: Digital Asset Offering Platform
- Objective: Develops a blockchain-based platform for creating and trading tokenized real-world assets, including housing and infrastructure.
- Wrapped CBDC Ltd (RI)
- Function: Digital Asset Offering Platform
- Objective: Introduces a Nigerian stablecoin (cNGN or c₦) pegged at 1:1 with the Naira for local and cross-border transactions.
- HousingExchange.NG Ltd (RI)
- Function: Digital Asset Offering Platform
- Objective: Allows developers to raise capital through property tokenization and provides a platform for liquidating investments.
- Dream City Capital (RI)
- Function: Digital Asset Offering Platform
- Objective: Offers a platform for digital real estate investment, allowing investors to acquire equity in pre-vetted residential and commercial properties.
- Blockvault Custodian Ltd (RI)
- Function: Digital Asset Custodian
- Objective: Provides secure infrastructure for the storage, management, and safekeeping of digital assets, with robust AML and KYC compliance.
Other applications for the ARIP and RI Program are under review and will be granted Approval-in-Principle on a case-by-case basis as they meet SEC requirements.
The SEC reminds the public that only approved digital exchanges and platforms are legally authorized to engage in crypto trading in Nigeria. The ARIP and RI Program are the official channels for introducing digital products and services to the Nigerian capital market. Investors are advised to avoid dealing with unauthorized operators and to verify the legitimacy of entities providing investment services through the SEC’s information portals.
