Nigeria’s Securities and Exchange Commission (SEC) has set up a committee to work on the framework for blockchain and virtual financial assets for the country’s capital market. 

The committee, called FinTech Roadmap Working Group, has been asked to develop a mechanism that will support innovation and regulation within the blockchain and virtual assets space.

The regulatory mechanism put together by the group will have aspects such as effective investor protection, financial market integrity, and financial stability, as its core areas of focus. Also, the framework will be geared towards ensuring the achievement of these aspects.

The group will take into cognizance effective investor protection, financial market integrity, and financial stability. It also has the responsibility of imbibing global best practices on regulatory taxonomisation, classification of Cryptocurrencies and recommending a suitable model for adoption in the Nigerian capital market.

The committee headed by seasoned financial expert, Ade Bajomo, consists of officials from regulatory agencies, tech experts and the private sector. The group has until the end of November to come up with a practical plan for regulating both blockchain and virtual assets, with a view to supporting their introduction in the market.

Nigeria seems to be warming up to the idea of embracing the advantages of blockchain and virtual financial assets. With this, the country may soon be joining the likes of South Africa, Swaziland, and Egypt as some of the few African nations that have drawn up regulations for the new wave of digital assets.

Digital services and financial technology have been identified by LocalBitcoins as key elements of the march towards financial inclusion and Nigerian authorities seem to be leaning towards leveraging its burgeoning FinTech space for the achievement of that purpose.

There is a huge market in the FinTech space as an estimated 36 million Nigerian adults are still without bank accounts. Meanwhile,  says Nigeria’s cryptocurrency market is the seventh-largest in the world in terms of peer-to-peer transactions.

The Central Bank of Nigeria (CBN) has made clear its intention of trimming the number of unbanked Nigerians to just 20 percent by 2020. And this new initiative by the SEC may be geared towards achieving that goal.

By Tobiloba Ishola.