The House of Representatives (HOR) is to investigate the current status of cryptocurrency, blockchain, digital asset transactions, all the online peer-to-peer (P2P) marketplace, utility sharing-based platforms and their practices, in Nigeria.
The House is also to investigate the current status of the E-Naira on the global cryptocurrency platform, the cost incurred, processes undertaken, and statutory compliance in creating the digital currency.
This is in a bid to identify threats to national security and gaps in legislative framework, statutes, and regulations to the detriment of the country.
This is sequel to the adoption of a motion on “Matter of Urgent Public Importance sponsored by Hon. Isiaka Ibrahim (APC, Ogun) on international money transfer operators, payment gateways and platforms, cloud computing, and infrastructure (networks).
Isiaka expressed worry at the huge sums of money that have been allegedly used to finance kidnappings, insecurity, banditry, and other illegalities.
The lawmaker expressed concerns about the national security implications of cryptocurrency transactions through cryptocurrency exchanges including consumer and investor security as these exchanges are said to enable money laundering by criminals and terrorists for their illicit activities.
Isiaka informed that as part of its sweeping market-friendly reforms designed to attract substantial foreign direct investments into the country’s struggling economy, this administration reversed the ban on cryptocurrency transactions in Nigeria imposed by the previous administration.
He noted the current actions by the government should not be perceived by the global community and international investors as a policy somersault so early in the life of the administration and the existence of a hostile business environment.
The lawmaker took cognisance of the concerns expressed by the CBN about the likelihood of illicit transactions and money laundering on the cryptocurrency exchanges and their seeming use as an alternative platform for determining local foreign exchange rates.
“The US Treasury 2022 National Money Laundering Risk Assessment indicates that fiat and traditional financial activities contribute substantially more (over 200%) than digital assets transactions to global money laundering activities.
“The conflict with the government about whether or not the crypto exchanges are determining the local foreign exchange rate and usurping the functions of the national bank does not appear to arise in other developed climes where appropriate statutes and regulations have been enacted and enforced to superintend crypto and other digital asset transactions.
“The government should not be seen to be trying to “throw away the baby with the bath water” without considering the benefits of digital asset transactions to the country” he said.
After the debate, the House resolved to engage all relevant stakeholders to initiate necessary processes for establishing required legislation and regulations, while establishing the profile of operators in the sector such as legal status, and parent company, and assess their compliance with our existing statutes or complicity in infractions against Nigeria including money laundering, illicit transactions, currency speculation and bad practices.
They resolved to superintend the engagement of the office of the NSA, other relevant agencies, cryptocurrency exchanges, and stakeholders in tracking, identifying, and recovering illicit and laundered funds or assets.
The House is to ensure that equity, probity, transparency, the rule of law, and international best practices are observed by the government in investigating cryptocurrency exchanges and others.
