Nigeria’s SEC Proposes Cryptocurrency Exchange Fee Hike

Nigerian Securities and Exchange Commission (SEC) has proposed rule changes for cryptocurrency exchanges, including raising the registration fee.

A proposed rule change by the Nigerian Securities and Exchange Commission (SEC) would increase the registration price for cryptocurrency exchanges from 30 million naira ($18,620) to 150 million naira ($93,000).

“Especially about the recent engagements with the CBN [Central Bank of Nigeria],” the SEC stated in the revision, adding that industry stakeholders had suggested the adjustments and that the agency wanted to add clarification. In May of 2022, the Nigerian SEC published regulations and guidelines for providing all digital assets and cryptocurrency services, but on Friday, March 15, 2024, it proposed revising those regulations.

The application price for digital asset exchanges, offering platforms, and custodians has been increased from 100,000 naira ($62) to 300,000 naira ($186) under the revised regulations.

A whopping one million naira ($620) is now required for processing, up from 300,000 ($186). A similar 400% increase from 30 million naira ($18,620) to 150 million naira ($93,102) is the registration fee.

“Rules on Digital Assets Issuance, Offering Platforms, Exchange, and Custody” would replace the current “New Rules on Issuance, Offering Platforms and Custody of Digital Assets.”

The SEC has noted that these revisions aim to clarify things and include feedback from people involved in the industry. Also included are considerations derived from recent meetings with the Nigerian central bank.

Some have questioned the 500 million naira ($310,343) paid-up capital requirement, even though the SEC claims that industry stakeholders contributed to the proposed adjustments. They argue that local entities would be disadvantaged due to this hefty cost, while foreign corporations would primarily benefit.

Among the world’s crypto economies, Nigeria’s growth rate has been among the most rapid in recent years. Regarding cryptocurrency usage in 2023, it will also be the world’s second-largest economy. According to Google’s tally of queries for “cryptocurrency” and “buy crypto,” Nigeria surpassed all other countries in August 2022 regarding crypto-obsession.

The Financial Times reports that in June 2023, Nigeria removed the naira from its long-term currency peg and permitted free trading. After that, record-high inflation hit the nation. The National Bureau of Statistics reports that consumer inflation in Nigeria climbed to approximately 30% in January 2024, marking the thirteenth consecutive month of such increases.