In recent times, Nigeria has been progressively moving towards bringing blockchain technology into its economy. Adding to their endeavors, the country’s Federal Executive Council approved a blockchain policy that would help boost its digital economy.
The Federal Executive Council (FEC) is the cabinet of the Federal Republic of Nigeria and is part of the executive branch of the Government of Nigeria. It has a constitutional role in advising the President to determine the direction of government, although the President is the ultimate executive decision-maker.
On Thursday, the Ministry of Communications and Digital Economy took to Twitter to share about an upcoming policy as both the public and private sectors are involved in the discussions leading to the approval.
Sources reveal that the Ministry of Communications and Digital Economy was responsible for developing a policy, which would focus on creating a policy that incorporates all of the benefits of blockchain technology. The press release stated:
The vision of the Policy is to create a Blockchain-powered economy that supports secure transactions, data sharing, and value exchange between people, businesses, and government, thereby enhancing innovation, trust, growth, and prosperity for all.”
In addition, the press release counted on the benefits suggesting that the technology could be utilized in the healthcare, transportation, and supply chain industries, in addition to the financial industry. The agency urged both public and private sector entities to consider implementing blockchain solutions.
The implementation of the National Blockchain Policy will have a positive effect on both the public and private sectors of the country.
Apart from this, Nigeria has also taken steps with respect to the utility of tokenized assets. The country’s regulator, Securities and Exchange Commission (SEC) aims to allow tokenized coin offerings on licensed digital exchanges.
However, these must be backed by assets that include equity, debt, or property, but not crypto. Like other nations, Nigeria is keen on ensuring that there must be a certain standard of investor protection. Nigeria’s SEC would focus on having fintech firms register as digital sub-brokers, crowdfunding intermediaries, fund managers, and more.
Nigerians have been very fond of cryptocurrencies as their economy went through a dark phase of inflation, currency devaluation, etc. Nigeria was also one of the fastest crypto adopters in the region before the central bank blocked local financial institutions from interacting with crypto services providers.
In January, the price of Bitcoin in Nigeria witnessed a tremendous increase as the Central Bank of Nigeria promoted a digitalized cash system. At one point, 1 BTC on the Nigerian crypto exchange NairaEX was valued at 17.8 million Naira, which translated to a fat $38,792 representing a 60% premium over the market price of Bitcoin, which stood at around $23,700 at the time.
Notably, for a country like Nigeria with severe economic issues, the integration of blockchain technology as stated by the authorities can come out in beneficial ways. Recently, Christopher Waller, governor of the Federal Reserve, highlighted the benefits of smart contracts in improving efficiency in the financial sector.