The Nigerian government is gearing up to implement fresh regulations that would prohibit peer-to-peer (P2P) cryptocurrency transactions involving the national currency, the Nigerian naira. Bloomberg reported on May 7 that the Nigeria Securities and Exchange Commission (SEC) is poised to unveil a new regulatory framework targeting cryptocurrency exchanges, custodians, and related industry entities in the near future.
Emomotimi Agama, the Director General of the SEC, emphasized that the forthcoming rules are designed to exclude the naira from P2P exchanges to safeguard the local currency against manipulation. He cited recent concerns regarding crypto P2P traders and their potential impact on the naira exchange rate as driving forces behind the need for concerted action.
This development follows Nigeria's imposition of a domestic ban on global cryptocurrency exchange Binance in February 2024, coupled with the arrest of its executives, Tigran Gambaryan and Nadeem Anjarwalla. Gambaryan, currently detained at the Kuje Correctional Center in Abuja, faces charges including tax evasion, currency speculation, and money laundering, with his trial scheduled for May 17.
Although major centralized exchange (CEX) platforms such as Binance operate P2P marketplaces, facilitating seamless transitions between CEX and P2P services, Binance announced the removal of the naira from its P2P service starting March 2024 in response to Nigeria's regulatory crackdown on the exchange.
In light of the intense scrutiny from Nigerian regulators and the subsequent detention of Binance executives, CEO Richard Teng criticized the Nigerian government for establishing what he deemed a perilous global precedent. Despite these regulatory actions and the planned P2P ban involving the naira, industry observers suggest that P2P cryptocurrency trading in Nigeria may persist, albeit with potential shifts towards alternative currencies such as the US dollar.
