Following a crucial meeting held on Monday between the Securities and Exchange Commission and digital asset operators, the Federal Government may contemplate suspending the $56.7bn peer-to-peer cryptocurrency market.
According to the 2023 Geography of Cryptocurrency Report by Chainalysis, a United States of America-based international blockchain analysis firm, Nigeria experienced a nine percent year-over-year growth in crypto transactions volume to $56.7bn between July 2022 and June 2023.
A broader effort by the Federal Government to tighten regulatory oversight within the cryptocurrency space is signaled by the latest move by the SEC, amidst growing concerns over illicit activities and the manipulation of the naira exchange rate.
In an ongoing audit of their Know-Your-Customer process, the Central Bank of Nigeria had stopped major fintech firms from onboarding new customers earlier this week.
After the regulatory action, major fintech firms, such as Opay and PalmPay, took the step of sending emails to their customers on Friday, warning them against trading in cryptocurrency or any virtual currency on their apps, and threatening to block any accounts found engaging in such activities.
The threat to block accounts has received significant backlash, especially from the 33.4 million individuals actively trading cryptocurrencies; a large number of whom depend on cryptocurrency trading as their main source of income.
During the proposed Monday meeting, it was learned that the government may opt to announce a temporary halt in P2P crypto trading to develop a comprehensive set of rules for effective regulation of the space.
According to other sources present at the meeting, the government is considering engaging with crypto stakeholders on a new set of rules to improve regulation in the space.
They ruled out the possibility of implementing a temporary halt on P2P crypto trading. The details of the precise decision the government might take during or after the meeting with the crypto operators were sketchy as of Sunday.
However, operators in the crypto market have confirmed the meeting, stating that it will focus on the current developments in the space.
