Nigeria’s Securities and Exchange Commission (SEC) is moving to update its guidelines around cryptocurrencies to prevent criminals from participating in capital markets, according to local reports this week.

The push comes amidst ongoing turbulence in Nigeria’s crypto sector regulation and signals intent to exert stronger control.

Key details:

• SEC seeking more oversight of crypto companies after previously declaring many large exchanges like Binance as operating illegally.
• The new guidelines include more stringent anti-money laundering and counterterrorism financing rules.
• Actions follow after the Central Bank of Nigeria recently unbanned banks from servicing crypto firms, following a prior outright ban.

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Documents from the SEC cited in Nigerian daily The Punch states that the Commission has developed new onboarding measures for crypto asset service providers (VASPs). It also includes anti-money laundering, counterterrorism financing, and counter-proliferation financing manuals.

Per the SEC, the goals include “ensuring criminals are not registered as operators” in the Nigerian capital markets. No further details were given on how assessments of criminality would be carried out.

Nigeria moves to tighten crypto oversight

The move is the latest in an ongoing tightening of crypto oversight in Nigeria over the past year. The Central Bank of Nigeria has specifically targeted large foreign exchanges like Binance. They also got local ISPs to block access to their platforms earlier this year.

Reports have emerged more recently that Nigeria is seeking over $10 billion in penalties from Binance alone for allegedly enabling the flow of $26 billion in untraceable funds. Two Binance executives were even temporarily detained last month after voluntarily flying to Nigeria to meet with regulators.

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Despite tensions, the Central Bank of Nigeria did reverse one of its prior outright bans on local banks doing business with crypto companies late last month.

The SEC similarly seems to be signaling a willingness to allow properly licensed crypto asset firms under its purview, assuming they meet the standards.