This is an op-ed by Heritage Falodun, a Bitcoin consultant and computer scientist based in Nigeria.
On 3 May 2023, during the meeting of the Federal Executive Council chaired by President Muhammadu Buhari in the Council Chamber in Abuja, The Nigerian government has approved the official use of blockchain technology in the country.
Nigerian Minister of Communications and Digital Economy, Professor Ali Issa PantamiAnd He revealed the official approval of the “National Blockchain Policy for Nigeria,” Stating that The new policy was the product of consultations with 56 institutions and individuals whose ultimate goal is to institutionalize blockchain technology in the Nigerian economy and security sectors.
Nigeria’s history with bitcoin regulation
A deeper understanding of the Nigerian government’s attitude towards blockchain-based innovations over the years will paint a clear picture of how relevant and significant this latest policy and federal approval of the Bitcoin space is in Nigeria and Africa at large.
On January 12, 2017, the Central Bank of Nigeria (CBN) issued issued a circular who warned financial institutions and the general public about the risks associated with blockchain-based technologies, such as Bitcoin. Based on this warning and previous directive, on February 5, 2021, the Central Bank of Nigeria officially banned banks from facilitating any Bitcoin and cryptocurrency related transactions by re-issuing the circular – a ban that has not yet been rescinded at the time of writing.
This restrictive policy comes at a time when the adoption of Bitcoin and Chitcoin related activities is on the rise in Nigeria, and it was a restriction to do so. Boost the use of bitcoin and stablecoins As users drowning in the pain of financial limitations increasingly discover the power of decentralized Bitcoin innovations, such as peer-to-peer (P2P) markets.
Amid all this impromptu regulatory action, CBN has apparently been busy creating what it sees as an alternative to shitcoins: a government-controlled digital currency called e-naira, which has been It was officially launched On October 25, 2021, it is unequivocally built on a centralized system, not a decentralized blockchain like Bitcoin. Meanwhile, the Nigerian Security and Exchange Commission (SEC) has been busy Create policy frameworks for token issuance platforms and exchanges.
All of these regulatory changes were not unrelated to the government’s awareness of how thriving the blockchain industry is in Africa’s most populous country.
What does this mean for Bitcoin in Nigeria?
At this point, one would naturally ask what another regulatory update in the national blockchain policy would mean for Bitcoin.
A quick and detailed response would be: This is certainly a welcome development for Bitcoin advocates in the country and one of many steps we may see in the right direction.
By my interpretation, this policy is more focused on giving a direct overview of the government to the relevant regulatory bodies such as National Information Technology Development Agency (NITDA), CBN, SEC, and Nigerian Communications Commission (NCC) and National Universities Commission (NUC), among many others who are now expected to develop more detailed regulatory frameworks than using blockchain-based innovations such as Bitcoin. The government is going from being averse or outright hostile to activities related to bitcoin, blockchain, and cryptocurrency to accepting them now by default and creating a regulatory environment for them going forward.
And while altcoins and other developments and products based on blockchains other than Bitcoin still have a chance to remain regulated and subject to the directives of these incoming regulations, Bitcoin is uniquely at odds with these regulations.
As a stakeholder in the African Bitcoin space, I must acknowledge that consistent clarity from governments will not only help drive adoption, but will also create an enabling environment for Nigerians to incorporate decentralized blockchain technology, such as Bitcoin, into scaling their businesses and lifestyles, while opening many opportunities. legal for all.
As the industry continues to evolve, conserve space, Nigerian President-elect Paula Tinubu has promised To enable the judicious use of blockchain technology and cryptocurrency in the banking and financial sector of the country. My fingers remain crossed until we are faced with the full implementation of bitcoin friendly regulations in Nigeria.
This is a guest post by Heritage Falodun. The opinions expressed are entirely their own and do not necessarily reflect the opinions of BTC Inc or Bitcoin Magazine.