(Bloomberg) -- Nigeria’s Securities and Exchange Commission does not plan to include cryptocurrencies in a plan to improve trading in digital assets until regulators agree on standards that protect investors.
The commission is avoiding the digital currency as crypto exchanges do not have access to the banking platform that is needed to drive their trades in Nigeria yet, Director-General Lamido Yuguda told reporters in Lagos, the nation’s commercial hub. “We are looking at digital assets that really protect investors,” not necessarily crypto, Yuguda said.
The position of the SEC clears the air on whether its rule on digital assets trading enacted in May covered crypto. While young Nigerians account for the largest volume of cryptocurrency transactions outside the US, according to Paxful, a peer-to-peer crypto trading platform, the central bank banned lenders from facilitating crypto trades to forestall threats to the financial system.
The SEC will promote investment in “sensible digital assets,” with investment protection and also explore blockchain technology to advance virtual and traditional investment products, Yuguda said. “The commission is in the business of protecting investors, not in the business of speculation,” he said, alluding to volatility concern in cryptocurrencies.
Nigerians showed more interest in cryptocurrencies than any other country since the digital assets began to decline in April, according to a study by price tracker CoinGecko. As the digital assets market undergoes development, crypto may be promoted by the SEC in the future, the DG said, adding “now any asset that is traded in the Nigerian capital market requires the joint approach of different regulators.”
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