1. PixelPlaygroundHome
  2. Web3 News

Token Issuance on Licensed Digital Exchanges: Nigeria’s SEC Considers New Regulations

• Web3 News • 109 views

According to reports, Abdulkadir Abbas, head of securities and investment services at the Nigerian Securities and Exchange Commission (SEC), stated that the Nigerian SEC is conside

Token Issuance on Licensed Digital Exchanges: Nigerias SEC Considers New Regulations

According to reports, Abdulkadir Abbas, head of securities and investment services at the Nigerian Securities and Exchange Commission (SEC), stated that the Nigerian SEC is considering allowing token issuance on licensed digital exchanges, which are supported by assets including equity, debt, property, but not cryptocurrency. The Nigerian SEC aims to register fintech companies as digital sub brokers, crowdfunding intermediaries, robot advisors, fund managers, and token issuers. It will not register cryptocurrency exchanges until an agreement is reached with the central bank on standards. Abbas stated that interested digital exchanges will undergo a one-year regulatory incubation period, during which they will only provide skeleton services supervised by the SEC to study their operational model and suitability for providing services in the country. Meanwhile, Abbas stated that by the 10th month of the incubation period, it will be possible to decide whether to register the company, extend its incubation period, or require the company to cease operations.

Nigerian SEC plans to allow licensed digital exchanges to issue tokens, with a regulatory incubation period of one year

In a recent announcement, Abdulkadir Abbas, head of securities and investment services at the Nigerian Securities and Exchange Commission (SEC), stated that the Nigerian SEC is considering allowing token issuance on licensed digital exchanges. These exchanges will be supported by assets including equity, debt, and property, but not cryptocurrency. The move is intended to register fintech companies as digital sub-brokers, crowdfunding intermediaries, robot advisors, fund managers, and token issuers.

The Nigerian SEC’s Plan

The Nigerian SEC is looking into the possibility of allowing token issuance on licensed digital exchanges, with support from assets like equity, debt, and property. This move is aimed at registering fintech companies as digital sub-brokers, crowdfunding intermediaries, robot advisors, fund managers, and token issuers. However, cryptocurrency exchanges will not be registered until an agreement is reached with the central bank on standards.

One Year Regulatory Incubation Period

Interested digital exchanges will undergo a one-year regulatory incubation period before becoming fully registered. During the incubation period, digital exchanges will only provide skeleton services supervised by the SEC. This will help the SEC better understand the operations of these exchanges and their suitability for providing services in the country.

Extending the Incubation Period or Ceasing Operations

By the 10th month of the incubation period, the SEC will be able to decide whether to register the company, extend its incubation period, or require the company to cease operations. Such measures will ensure that digital exchanges operate in accordance with the relevant regulations and do not put the market at risk.

The Benefits of Token Issuance on Licensed Digital Exchanges

The Nigerian SEC’s potential move to allow token issuance on licensed digital exchanges has several benefits. Firstly, it promotes innovation in the fintech industry, which can lead to job creation, investment, and economic growth. Secondly, it enhances investor protection by regulating digital asset offerings and ensuring that only licensed exchanges can offer such services.

Challenges Facing Token Issuance on Licensed Digital Exchanges

The move to allow token issuance on licensed digital exchanges in Nigeria may face some challenges. For example, some companies may be hesitant to enter the market due to the regulatory requirements and costs associated with operating a licensed exchange.
Another challenge may be the lack of investor understanding of digital assets and the potential risks involved. The SEC will need to educate investors about the benefits and risks of investing in digital tokens, and ensure that only accredited investors are allowed to invest in such assets.

Conclusion

The potential move to allow token issuance on licensed digital exchanges in Nigeria is a positive step towards innovation and growth in the fintech industry. However, it is important that the SEC takes measures to ensure that only licensed exchanges operate in the market, and that investors are fully protected from potential risks.

FAQs

1. What is the Nigerian SEC’s plan regarding token issuance on digital exchanges?

The Nigerian SEC is considering allowing token issuance on licensed digital exchanges, with support from assets like equity, debt, and property. This move is aimed at registering fintech companies as digital sub-brokers, crowdfunding intermediaries, robot advisors, fund managers, and token issuers.

2. What is the incubation period for digital exchanges in Nigeria?

Interested digital exchanges will undergo a one-year regulatory incubation period supervised by the SEC. By the 10th month of the incubation period, the SEC will decide whether to register the company, extend its incubation period, or require the company to cease operations.

3. What are the benefits of token issuance on licensed digital exchanges in Nigeria?

Allowing token issuance on licensed digital exchanges in Nigeria promotes innovation in the fintech industry and enhances investor protection by regulating digital asset offerings. This can lead to job creation, investment, and economic growth.

This article and pictures are from the Internet and do not represent Fpips's position. If you infringe, please contact us to delete:https://www.fpips.com/19324/

It is strongly recommended that you study, review, analyze and verify the content independently, use the relevant data and content carefully, and bear all risks arising therefrom.

Like (0)
Previous 05/01/2023 06:57
Next 05/01/2023 08:01

Recommended articles