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Nigeria Federal Executive Council approved a national blockchain policy in a meeting on May 3, 2023.
This policy will enable the country to develop a proper regulatory framework for blockchain adoption.
Nigeria is one of the nations whose citizens have an avid interest in cryptocurrencies.
However, crypto transactions involving traditional banks are considered illegal in the region due to a controversial ban.
Federal Executive Council Approves Blockchain Policy Adoption
The Nigerian Federal Executive Council (FEC) confirmed adopting a national blockchain policy. This approval is in response to a memo from the Nigerian Minister of Communications and digital economy, Isa Ali Ibrahim.
Also, in an official announcement, the Federal Ministry of Communications and Digital Economy (FMCDE) referred to a report from PriceWaterhouseCoopers.
The report from 2020 states that adopting blockchain technology across various sectors and industries can potentially contribute $1.76 trillion to the global gross domestic product by 2030.
This long-term projection represents 1.4% of the world's GDP.
The FMCDE developed this policy in collaboration with the Federal Government of Nigeria, correlating to the seventh pillar of digital economy policy and strategy.
The policy aims to create a framework for executing secure blockchain-based transactions and data sharing among individuals, businesses, and governments.
Notably, the FMCDE has instructed regulatory bodies to handle the regulatory framework creation and implementation in various sectors.
These bodies include the Central Bank of Nigeria, the National Universities Commission, and the Nigerian Communications Commission.
Also, the FMCDE aims to use different strategies to encourage blockchain adoption, such as promoting digital identity and encouraging digital literacy.
Also, it plans to establish a national sandbox for testing, piloting, and hosting blockchain business and incentive programs.
Nigeria Poised To Create Regulatory Framework For Stablecoins
Nigeria is one of the nations with massive interest in cryptocurrencies. It ranks second by Google Trends on most searches for Bitcoin in the last twelve months.
Nigeria is one of the early pioneers of CBDCs in Africa, rolling out the e-Naira.
Currently, the Central Bank of Nigeria stated in a report in January 2023 its readiness to accept private stablecoins.
However, a legal framework for regulating such projects is a priority for the financial regulator.
The report, tagged 'Nigeria Payments System Vision 2025', also details regulations for initial coin offerings (ICOs).
It states that this area's current lack of regulations translates to investor losses. The CBN sees ICO adoption as a fundraising avenue for capital projects, crowdfunding, and peer-to-peer lending.
Notably, the Central Bank of Nigeria's eNaira struggled to gain relevance, with less than 0.5% of the population using the digital asset as of October 25, 2022.
However, the recent blockchain policy adoption may finally improve the performance of digital assets and the Nigerian CBDC.