In the growing tension and uncertainty within Nigeria’s cryptocurrency industry, local crypto stakeholders have voiced strong support for a regulatory framework centered on compliance rather than criminalization.
Obinna Iwuno, former President of the Stakeholders in Blockchain Technology Association of Nigeria (SiBAN), has emerged as a key advocate for a more balanced and constructive approach to crypto regulation in the country.
Plea for a nuanced approach
Iwuno argues that Nigeria’s current regulatory approach, which has led to high-profile legal battles and the detention of cryptocurrency executives, is not only counterproductive but also potentially damaging to the country’s global reputation.
He emphasizes the need for a regulatory environment that prioritizes fines and operational restrictions over punitive measures unless there is a clear violation of the law or a threat to national security.
“Nigeria is a big player globally in cryptocurrency that it cannot afford not to regulate crypto,” Iwuno stated. “We stand to gain a lot by regulating it than we stand to lose from a well-regulated ecosystem.”
Iwuno’s comments come amid Nigeria’s ongoing legal conflict with Binance, one of the world’s largest cryptocurrency exchanges.
Binance has been embroiled in a series of legal challenges in Nigeria, including charges of money laundering and tax evasion, which have resulted in the arrest and continued detention of one of its executives, Tigran Gambaryan.
This aggressive regulatory stance has raised alarms among industry stakeholders, who fear it could stifle the growth of the crypto sector in Nigeria and harm the country’s international standing.
India’s example
In contrast, other members of the local crypto community have pointed to India’s recent resolution of its regulatory standoff with Binance as a model worth emulating. In India, the Financial Intelligence Unit (FIU) imposed a $2.25 million fine on Binance and required the exchange to register as a reporting entity.
This approach allowed Binance to resume normal operations while ensuring compliance with local regulations. Nigerian crypto professionals are praising the Indian government’s strategy, which combined penalties with constructive engagement, as a more mature and effective way to manage the complexities of cryptocurrency regulation.
Related: Why Nigeria’s blockchain success hinges on private sector expertise
Local policy and data analyst Obinna Uzoije echoes Iwuno’s sentiments, highlighting the stark differences between India’s balanced approach and Nigeria’s more punitive tactics.
Uzoije highlighted the importance of dialogue and compliance-focused regulation, arguing that India’s method of resolving its issues with Binance ensured that individuals’ rights were respected while also fostering an environment conducive to both oversight and innovation.
“This approach prevents the damaging consequences of imprisoning employees as a means of exerting pressure,” Uzoije noted.
He further asserted that India’s strategy represents a forward-thinking regulatory framework that prioritizes cooperation over punishment, thereby minimizing disruptions to business activities and preserving investor trust.
Magazine: Meme coins: Betrayal of crypto’s ideals… or its true purpose?