Princewill Pius
The Securities and Exchange Commission (SEC) of Nigeria has granted provisional licenses to two cryptocurrency exchanges, Busha Digital Limited and Quidax Technologies Limited, under its Accelerated Regulatory Incubation Programme (ARIP). This move marks a significant step towards establishing a regulated environment for digital assets in Nigeria.
In an official statement released on Thursday, the SEC revealed that the current cohort of the ARIP includes a total of two digital asset exchanges, four digital asset offering platforms, and one digital asset custodian. These entities are being monitored and tested under the programme to ensure they meet regulatory standards and provide safe, secure services to users.
Busha Digital Limited has been recognized for its digital exchange platform, which allows users to buy and sell cryptocurrency using fiat currency. The platform offers individuals and businesses in Nigeria and other emerging markets the ability to invest in digital assets. Customers can utilize Busha’s mobile and web applications for various services, including buying, selling, storing, sending, receiving, and making payments with cryptocurrencies.
Quidax Technologies Limited operates a cryptocurrency trading platform that leverages blockchain technology to enable the trading of various digital tokens. The company’s proprietary blockchain supports the listing and trading of already-issued crypto assets. Accessible through both web and mobile platforms, Quidax also provides a digital wallet feature, allowing users to store and transact in multiple cryptocurrencies.
Alongside these two exchanges, the SEC has also welcomed five other companies into its Regulatory Incubation Programme to test their innovative technologies and business models. These companies are Trovotech Ltd, Wrapped CBDC Ltd, HousingExchange.NG Ltd, Dream City Capital, and Blockvault Custodian Ltd.
The introduction of the ARIP by the SEC aims to bring firms that were already operational before the establishment of the Rules on Virtual Asset Service Providers in May 2022 under regulatory oversight. The programme is designed to evaluate the business models of digital asset firms and to test new products and services in a controlled, real-time market setting.
“The RI Programme was created to assess the business models of digital assets firms and test innovative products, services, and technology in a real-time market environment under close supervision by the SEC,” the commission explained. “The outcomes of this process will play a crucial role in shaping future policies and regulations in the digital asset space.”
These provisional licences are a step toward full regulatory approval, with the SEC aiming to ensure that all crypto platforms operate transparently and with adequate protections for investors. The commission has also advised the public to exercise caution when engaging with digital platforms, underscoring the importance of dealing only with SEC-approved entities.
In its advisory, the SEC reiterated, “Only approved digital exchanges and platforms are legally authorized to carry out the business of crypto trading in any form in Nigeria. The ARIP and RI Programme remain the sole channels for companies to introduce their digital products and services to the Nigerian capital market legitimately.”
This development marks a pivotal moment for the cryptocurrency industry in Nigeria, as the SEC continues to pave the way for a regulated and secure digital asset market.