Stakeholders in Blockchain Technology Association of Nigeria (SiBAN), have cited the lack of regulation for the rise of peer-to-peer crypto trading in Nigeria.
President of SIBAN, Mr. Obinna Iwuno made this statement on Saturday during an X space session addressing the state of web3 in Nigeria. The session took place amidst the backdrop of the government’s recent clampdown on crypto transactions in the country.
Mr. Iwuno stated that if the government had regulated the crypto industry, p2p trading wouldn’t have surged to this level, as everyone would transact through regulated exchanges and not P2P. He also noted that if nothing is done, the system would be infiltrated by criminals using it as a means to carry out illegal transactions.
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In his words,
“We need regulation as an industry. Regulation will help us more than an unregulated sector would help us. In fact, the reason why fingers are being pointed at P2P presently is because of the lack of regulation.
“And if the government had regulated the industry, I bet you that there would have been no rise in P2P because everybody would have been trading through regulated agencies and exchanges and we wouldn’t have an issue of so much rise in P2P that is unregulated and now being accused of economic sabotage and manipulation of forex rates, which is affecting the economy”.
Moving forward the SIBAN president urged for stakeholders to join hands on deck to ensure the industry is well regulated, which according to him can help the nation achieve economic development and wealth creation.
“When we have a regulated space, it is going to help us to achieve economic development and wealth creation using this technology. We stand a big chance at it than when we are operating in an unregulated space. What we are seeing currently is not the action of our industry, but because certain things have been made to look as though this is what our industry represents.
“Accusing fingers are being pointed at us when we are not guilty and it is one that we have to deal with because if we don’t deal with it, it has the possibility of spreading even further than it is now and hurting the industry more than it is already. We do not want to wake up one day and crypto has been criminalized and then has been made illegitimate and illegal and against the law,” he added.
SIBAN’s call for the regulation of peer-2-peer trading in Nigeria is coming after it was revealed that P2P transactions in the country is predicted to be around $500 billion.
Ray Youssef, the Chief Executive Officer of Nigeria’s prominent cryptocurrency platform, Noones, made this revelation comes amidst mounting regulatory pressure on cryptocurrency activities in Nigeria.
In a recent interview, Youssef shed light on the meteoric rise of P2P transactions, particularly in the context of an impending ban on cryptocurrency within the country. He emphasized that the official volume of cryptocurrency transactions in Nigeria stands at $59 billion annually, but the actual figure could be ten times higher, hovering around the $500 billion mark.
According to him, the bulk of P2P transactions evade traditional cryptocurrency platforms like Binance, occurring instead on platforms like WhatsApp, Telegram, and even in coffee shops and streets across the nation. He noted that the $59 billion reported volume largely conceals the true extent of P2P trading, which is significantly more pervasive.
It is worth noting that the rationale for a ban on p2p trading in Nigeria, is linked to the Central Bank’s belief that crypto traders use peer-to-peer trading to manipulate the naira via a pump-and-dump strategy. Nevertheless, these traders have voiced discontent with the government’s actions, arguing that cryptocurrency should not be scapegoated for currency devaluation.