Recent SEC's ₦2 Billion on Exchanges: Hope Your Naija Exchange Is Not Affected?

[Call_Me_Guru]

As we were still trying to wrap our heads around the new crypto tax and bad happenings in Nigeria, the SEC announced an increase in the entry fee to register into the Nigerian Crypto Industry. As someone who watches the crypto regulatory activities closely, I think we need to talk about what this means for our coins.

I would like us to consider these two facts:

1. The ₦2 Billion will build constraints
The SEC just released a circular last week raising the capital base for Digital Asset Exchanges (DAXs) to ₦2 Billion. For smaller Ancillary providers, the requirement has increased to ₦300 Million. These monies are big.

Why we should not take it lightly: This is a huge raise of about 4 times from the former amount (₦500 Million). We all know what a high raise in the minimum capital like this does to ecosystems. Some exchanges will liquidate or merge with other ones or be sold to bigger ones. This calls for the alert on the financial health of the ones we use.

2. The June 2027 is nearer than thought
The SEC has mandated every platforms to meet this target until June 30, 2027 deadline. Don't think this is a long time, we know that time flies, let's start acting now.

Let's consider this effect:

• Some exchanges will go bankruptcy and some potential startups will avoid the industry due to the huge ₦2 billion requirement. Don't forget, exchanges are not insured in Nigeria.
• If we are not smart, we might fund their licenses. The current exchanges could raise the capital or reimburse themselves before the time through insane fees, unethical practices and even account blocking, which is not new, but might increase.
• But the good side is that the industry will be strengthened.

What the regulators are doing is fine and very positive, they are trying to strengthen the crypto industry and make it more difficult for exchanges to collapse under their watch. However, my efforts for this thread is for awareness's sake and for action plans, if possible.

My advice to you guys

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• Diversify your crypto portfolio. Don't use a single exchange in Nigeria and consider self-custody approach. Offshore exchanges are also good options.
• Investigate about your exchanges to know if they are capable of the new standard. If you still want to keep them.
• Stay at alert and flee if you start hearing increasing cases of fraudulent acts from your local exchanges. Don't wait until it's your turn.

I hope this info helps!

[Btcalysis]

The ₦2 Billion caught my attention, this amount is big you know,  the news no popular sha. Our government just dey show say dem sabi sha, well, e good too sha. The issue be say e fit affect small exchange and the one wey won join newly, the capital go discourage them, e no too good like that.

But I no agree with you for the part of insurance. Exchanges as a company go get their insurance if dem get sense. The only issue be say dem fit no dey under the government insurance scheme of the Nigeria Deposit Insurance Corporation (NDIC). Na two different mata.

[Call_Me_Guru]

the news no popular sha. Our government just dey show say dem sabi sha, well, e good too sha.

Yes, it is not, it's not bank we are talking about anywhere most people have their daily activities. The news like this is not always popular, it is the implementation that is popular when it starts hitting people by the direct and indirect effect caused by it on people's favorite Nigerian exchange that can have return effects on the people.

But I no agree with you for the part of insurance. Exchanges as a company go get their insurance if dem get sense. The only issue be say dem fit no dey under the government insurance scheme of the Nigeria Deposit Insurance Corporation (NDIC). Na two different mata.

Thanks for the observation and correction, I mean exactly what you mentioned if I would be clear. The insurance I meant was the popular NDIC mandated in banks and many other financial institutions to cover customers capital in case of insolvency to a tune of a certain big amount. That amount is big enough for all retail investors to be kept safe if implemented

[DPHOR]

What the regulators are doing is fine and very positive, they are trying to strengthen the crypto industry and make it more difficult for exchanges to collapse under their watch. However, my efforts for this thread is for awareness's sake and for action plans, if possible.

My advice to you guys

`

• Diversify your crypto portfolio. Don't use a single exchange in Nigeria and consider self-custody approach. Offshore exchanges are also good options.
• Investigate about your exchanges to know if they are capable of the new standard. If you still want to keep them.
• Stay at alert and flee if you start hearing increasing cases of fraudulent acts from your local exchanges. Don't wait until it's your turn.

I hope this info helps!

It would be a pity to see that after this information shared across some people would still have that feeling or chances of leaving their assets into exchange, of course it would mostly affect most traders or to those who doesn't have that passion of using a self custodial wallet than directly using exchange address to store their holdings. It has been advised many times that "Not Your Key Not Your Coin" and  there are still people who still find it pleasurable by leaving their assets inside an exchange.

[Doan9269]

Diversification is very important, moreso, holding our assets in a non custodial wallet should be the paramount decision we should be going for, only when we wanted to exchange bitcoin to fiat we can send our coins to the intended exchange for them to help out through p2p, don't use an exchange as your major holding portfolio, anything can happen from the government regulations which may affect your asset with these exchange.