Nigeria’s Securities and Exchange Commission (SEC) has expressed a more positive outlook on cryptocurrencies, with a focus on using them to provide financial services to the country’s unbanked population.
Bitcoin Seen as Key to Financial Inclusion in Nigeria
According to Emomotimi Agama, the director of the SEC, bitcoin (BTC) can play a significant role in Nigeria’s current financial network due to its low transaction costs, making it easier for Nigerians abroad to send money to their home country.
The Nigerian crypto market is currently valued at over $400 million, with Agama predicting it will reach $52.5 million by 2028. Currently, around 33.4% of Nigerians use or engage with cryptocurrencies, offering significant potential for financial inclusion.
Cryptocurrencies could be particularly beneficial for the 38 million unbanked Nigerians, who may not have access to traditional banking services. Agama noted that while many do not have bank accounts, they do have access to digital wallets, which can act as an alternative to traditional banking services.
“Some people don’t have a bank account, but they do have a wallet,” the director said.
Challenges Facing Nigeria’s Crypto Market
Despite the benefits, Agama also acknowledged the challenges associated with using crypto, including regulatory uncertainty, security concerns, and a lack of financial literacy. To address these challenges, Agama advocates for balanced regulation, improved cybersecurity measures, and financial education.
Since his appointment in April, Agama has taken steps to improve regulations surrounding digital assets, including changes to the rules governing the issuance, trading platforms, and custody of digital assets. These rules aim to bring providers of digital services in line with the new regulations and protect the market.
