In Nigeria, there is growing advocacy for a change in the regulatory framework governing the cryptocurrency sector, with calls to focus on compliance rather than criminalization. Obinna Iwuno is the former president of the Blockchain Stakeholders Association of Nigeria (SiBAN). He has become a vocal advocate for a more balanced regulatory approach.
Iwuno also noted that the current legal framework, which has given rise to contract laws and legal battles, as well as the arrest of prominent figures in the cryptocurrency sector, could be detrimental to Nigeria’s image and the development of the cryptocurrency sector in the country. He advocated that fines and operational restrictions should be an area of focus in the regulatory process rather than punitive measures, except in cases of litigation or threats to national security.
In light of this assertion, Iwuno argued that for Nigeria to take its place in the global cryptocurrency market, there is need to regulate cryptocurrencies rather than banning them altogether. He argued that proper regulation of the ecosystem brings more benefits than losses.
This campaign comes at a time when Nigeria is embroiled in various legal disputes with Binance, a major global cryptocurrency exchange. For example, Binance has been linked to money laundering and tax evasion issues that led to the arrest and detention of its employee, Tigran Gambaryan. Such a strict regulatory approach has raised skepticism among market participants about Nigeria’s ability to develop the cryptocurrency industry and the country’s solvency.
Nigeria urged to adopt dialogue-based regulation, like India’s handling of Binance
However, some local experts have mentioned that India’s approach The response to these issues in the recent past involving Binance has been much better. In India, the Financial Intelligence Unit (FIU) fined Binance $2.25 million and required the exchange to register as a reporting entity. This allowed Binance to continue business as usual while navigating the legal boundaries that govern its operations, earning it a reputation as an exemplary adversary between regulators and cryptocurrency exchanges.
Policy and data analyst Obinna Uzoije echoed Iwuno’s sentiments regarding the comparative strategies of India and Nigeria. Uzoije supports a dialogue and compliance approach to regulation claiming that it establishes effective regulation and encourages innovation, which is important for gaining investor confidence.
This perspective underscores the growing conviction that a move towards a compliance-focused regulatory framework could better support the cryptocurrency the growth and stability of industry in Nigeria.
