Regulation
IMF now recommends regulation of crypto in Nigeria similar to that of financial intermediaries – BitKE
The International Monetary Fund (IMF) has recommended that global cryptocurrency trading platforms be registered or licensed in Nigeria and subject to regulatory requirements.
The IMF made this recommendation in the latest IMF Staff Report on Nigeria warning that the rapid growth of foreign exchange trading platforms in Nigeria poses new challenges to the country’s financial stability.
“Staff recommends that global crypto trading platforms be registered or licensed in Nigeria and subject to the same regulatory requirements applicable to financial intermediaries on a same business, same risk and same regulation basis.”
The IMF also urged Nigerian authorities to strengthen preventive anti-money laundering and counter-terrorist financing (AML/CFT) controls on cryptocurrency trading platforms. He highlighted the need for effective risk-based oversight of these platforms and other virtual asset service providers.
In their talks with the IMF team, Nigerian officials stressed the need to stabilize the foreign exchange market through key reforms. They highlighted the growing pressure on the exchange rate resulting from illicit flows via cryptocurrency platforms and authorities stressed the importance of preserving external stability.
They pointed out that recent reforms and initiatives aimed at attracting foreign exchange liquidity, such as the directive requiring international oil companies to retain 50% of oil revenues repatriated to Nigeria for a period of 90 days, were designed with the aim of ‘reach this goal. .
According to the Nigerian government, illicit flows via cryptocurrency platforms put undue pressure on the exchange rate. As a result, authorities have taken steps to impose stricter controls on crypto platforms and improve compliance with current foreign exchange regulations.
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“There was a meeting of crypto founders on Tuesday [February 27 2024] morning, and a number of them agreed to suspend transactions on their platform,” a person at that meeting told a local… pic.twitter.com/iiYBuYrpOu
–BitKE (@BitcoinKE) February 29, 2024
“The authorities agreed on the importance of maintaining external stability and stressed that the reforms they have implemented as well as efforts to attract foreign currency liquidity – including the obligation for international oil companies to hold 50 percent of oil revenues repatriated to Nigeria for 90 days – are geared towards this end.
They believe that pressure on the exchange rate now comes from illicit flows, including through crypto asset platforms, and is not driven by fundamentals, noting that some caps on foreign exchange access are intended to combat against abuse.
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