SEC values Nigeria’s cryptocurrency market at over $400m

From Adanna Nnamani, Abuja

Nigeria’s cryptocurrency market is said to be rapidly expanding, with the Security and Exchange Commission (SEC) estimating its value at over $400 million.

Speaking at the 2024 Annual Conference of the Association of Capital Market Academics of Nigeria (ACMAN) in Abuja recently, SEC Director-General Mr. Emomotimi Agama said that a significant portion of the country’s population is involved in crypto-currency trading and transactions.

Agama said that Nigeria has emerged as a leading nation in crypto adoption, with transactions amounting to $56.7 billion between July 2022 and June 2023 alone.

He pointed out the potential of cryptocurrencies to serve Nigeria’s unbanked population, approximated at 33.4 percent, by providing accessible financial services through digital wallets.
Additionally, the DG noted the transformative impact of cryptocurrencies on remittances, adding that Bitcoin’s has the ability to slash transaction fees by up to 50 percent, making it a more affordable alternative to traditional remittance channels.

He further stated that due to Nigeria’s position as a significant recipient of remittances in Africa, cryptocurrencies provide a promising solution for efficient cross-border transactions at a lower cost.

Despite these advantages, Agama acknowledged persistent challenges such as regulatory uncertainties, cybersecurity risks, and the need for enhanced financial literacy among the population.

He stressed the importance of a balanced regulatory framework to foster innovation while safeguarding investors and consumers.

He said: “Reports indicate that Nigeria’s crypto transaction volume reached $56.7 billion between July 2022 and June 2023, representing a nine percent year-over-year growth.

“The country’s crypto market is estimated to be worth over $400 million, with a significant portion of the population involved in crypto-currency trading and transactions.

“Crypto-currencies can significantly reduce remittance costs, with Bitcoin transactions cutting fees by up to 50 percent. Nigeria is one of the largest recipients of remittances in Africa.

“Crypto-currencies offer a more efficient and cost-effective way for Nigerians abroad to send money home. With traditional remittance fees often being prohibitively high, crypto-currencies provide a cheaper and faster alternative.

“The lack of a comprehensive regulatory framework has created uncertainty, which can deter both investors and innovators. Cybersecurity threats, including hacking and fraud, pose significant risks.

In his remarks, the Chairman of the Securities and Exchange Commission, Mr. Mairiga Katuka, also stressed the opportunities presented by cryptocurrencies for Nigeria’s dynamic financial markets and called on stakeholders to collaborate in charting a sustainable path forward.

“Together, we can drive the development of a vibrant, resilient capital market in line with President Bola Tinubu’s dream of making Nigeria a prime investor destination.

“Let us work together to build a capital market that does not only see the needs of today but also anticipates problems to find solutions before the issues arise,” Katuka urged.