Nigeria’s Crypto Influencer Regulations: What It Means for Trading Platforms

It seems like Nigeria is shaking things up in the crypto world with its new regulations for crypto influencers. The Nigerian Securities and Exchange Commission (SEC) is stepping in, and it feels like a lot is about to change for digital currency trading platforms. As the SEC enforces stricter rules, both influencers and platforms are going to have to adapt to this new landscape. So, what does this mean for the new cryptocurrency exchange platforms and the influence of online crypto traders?

The New Rulebook for Influencers

The SEC has come out with new laws specifically targeting crypto influencers, which is an update to the previous rules. Under these new regulations, all crypto platforms need to get a license from the SEC before they can start promoting their services. We’re talking about ads on TV, radio, social media, and print media.

Crypto influencers are now required to disclose any financial benefits they get for promoting a platform or asset. If they don’t comply, they could face a fine of 10 million naira or even a three-year prison sentence. And this is all set to kick in on June 30, 2025. It looks like the SEC is cleaning up the crypto industry in Nigeria, putting an end to exploitative practices.

Impact on Trading Platforms

The rules come with specific requirements for third-party and social media promotions. Any crypto company wanting to work with influencers must send a written request to the SEC. The influencers must follow the rules set out, and the platforms must ensure compliance.

The SEC also mentioned that influencers have to provide a copy of their agreement letter and make sure the products they are promoting have all the necessary licenses. They must also let their followers know if they were paid for their services.

The SEC promises to keep an eye on promotional activities and will sanction anyone caught violating the rules, which could include monetary penalties as well. They are also committed to periodically reviewing the rules to keep them in line with global trends and to promote innovation.

Looking Ahead

This has sparked discussions among prominent crypto analysts. During a Twitter Spaces session, crypto educator Rume Ophi expressed a mixed view. He thinks that the new laws will bring some integrity to the industry, which has been plagued by bad actors exploiting the lack of regulation.

He highlighted that the SEC’s support for these new rules is a positive step. However, he also pointed out that it’s important to have the government’s backing for the crypto industry to thrive. Ophi believes that these regulations could prevent questionable projects from being advertised.

The SEC Chairman has also thanked President Bola Ahmed Tinubu for his pro-crypto stance, signaling a new era for crypto trading in Nigeria.