Uche Uwaleke, Professor of Finance and Capital Market, has lauded the Securities and Exchange Commission (SEC) of its plan to start regulating crytocurrencies investments in the country.
Uwaleke, of the Nasarawa State University, disclosed this in an interview with newsmen.
A cryptocurrency is a digital money that operates on the blockchain technology.
He said that the commission’s decision was a welcome development, considering the economic realities of the country.
Uwaleke noted that there had been an increase in digital investments due to COVID-19 pandemic which depressed returns in other assest classes.
He explained that crytocurrency regulation would ensure market integrity and transparency of operations
It would also ensure safe-keeping of participants’ assets, appropriate price discovery mechanisms and investors protection.
Uwaleke said that the SEC decision was timely and in line with the International Organisation of Securities Commissions guidelines on cryptocurrencies regulation.
“Cryptocurrencies and other digital investments have come to stay and so it will amount to living in denial not to recognise their risks and benefits.
“This is particularly so with the increase in digital investments following COVID-19 which depressed returns in other asset classes.
“As a new investment channel with unique payment, clearing and settlement systems, digital investments have inherent risks.
“So, the least market participants would expect is a fair market that is well regulated,” Uwaleke said.
He said that the Central Bank of Nigeria (CBN) and SEC needed to be proactive in the interest of the investing public and the financial system in general.
SEC on Monday said that it would begin regulation of crypto-token or crypto-coin investments in Nigeria.
It said regulation was important to protect investors and ensure market integrity and transparency.
The commission said the general objective of regulation was not to hinder technology or stifle innovation but to create standards that encourage ethical practices.
The Nigerian government had in the past described digital currencies as illegal and warned its citizens against