Nigeria urges adoption of European-inspired cryptocurrency regulations
Nigeria’s cryptocurrency community has praised Europe’s Markets in Cryptocurrency Asset Regulations (MiCA) stablecoin rules as a positive development, saying it is important for jurisdictions to prioritize interests associated with cryptocurrency projects to protect local currencies.
In an interview with Cointelegraph, Nigerian data and policy analyst Obinna Uzoize shared his thoughts on what the Economic Community of West African States (ECOWAS) can learn from Europe’s MiCA. He highlighted the numerous benefits that ECOWAS’ crypto regulatory framework would bring to member states.
MiCA’s Stablecoin System
Uzoije pointed out that stablecoins are currently the most prominent use case for crypto assets. According to him, Africa in particular has more transactions using stablecoins than any other digital asset.
In this context, MiCA’s “Stablecoin Regime”, which comes into effect on June 30, will be a significant milestone for crypto asset regulation in Europe and potentially beyond.
Without a transition period, the regulation will require issuers and other entities to obtain a MiCA license to publicly offer or trade asset-referenced tokens (ARTs) or electronic money tokens (EMTs) within the European Union.
Attracting Cryptocurrency Investors to ECOWAS
According to Uzoije, the current leadership of ECOWAS by Nigerian President Bola Tinubu provides the perfect opportunity for the organization to develop a regulatory framework for cryptocurrency projects.
Meanwhile, some ECOWAS countries, such as Sierra Leone, have strict or outright bans on cryptocurrencies. The application of an overall regulatory framework by ECOWAS across its 15 member countries could help alleviate these restrictions.
Related: Bitstamp to Discontinue Tether’s Euro Stablecoin Under New MiCA Regulations
A unified regulatory framework for all ECOWAS member states would provide much-needed clarity to potential cryptocurrency investors. Uzoije suggested that ECOWAS-specific rules would simplify investments across member states and eliminate the need to comply with multiple national regulations.
“This could attract more investors by addressing one of the major global drawbacks of cryptocurrency investing: regulatory uncertainty.”
Uzoije spoke considering that Nigerian authorities have cited money laundering as a significant issue with Binance in the ongoing dispute. ECOWAS can strengthen anti-money laundering by establishing a uniform regulatory framework across member countries.
According to Uzoizze, this will simplify the tracking of money laundering by cryptocurrency institutions within ECOWAS. Terrorism, a major concern, is also linked to cryptocurrency financing. Clear regulations will help authorities tackle the financing of terrorism.
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