On one hand, this news brings a feeling of certainty on the position of cryptocurrency. For a number of years now, the legal stance of Bitcoin has been debated in Nigeria and for most of the part, the government was leaning towards making it illegal, with frequent stern warnings at citizens to steer clear from it - So, it's a positive as crypto enthusiasts know the legal position.
Having read through the thread, I agree with the majority opinion, there are positives and downsides to the ruling. The obvious advantage is that it could have been the
worse case scenario (crypto being illegal), there would also be less ICO, IEO and STO scams.
Regulation however comes with its fair share of disadvantages;
• If the sector is handled too stringently, growth would be limited i.e, too much regulatory paperworks would frustrate developers.
• Investors could create a false sense of security and begin to scrutinize projects less with the believe that scams would not filter through.
• There is the risk of user data being handed over to government agencies on request as regulatory laws would make it difficult for platforms to reject.
• There's also the issue of wrong classification. The article read that - (paraphrasing) "All cryptocurrencies are considered securities, until proven otherwise", but the description of securities already proves Bitcoin otherwise:
Security Tokens” (e.g., virtual tokens that
have the features and characteristics of a security. Represent assets such as
participations in real physical underlyings, companies, or earnings streams,
or an entitlement to dividends or interest payments. In terms of their
economic function, the tokens are analogous to equities, bonds, etc.
There is of course no issuer or sponsor to challenge that position for Bitcoin.
We would just have to wait and see how the crypto market reacts...
