The Nigerian Securities and Exchange Commission (SEC) has issued a 30-day ultimatum to Virtual Asset Service Providers (VASPs) to update their applications in line with new regulations. This move aims to strengthen the regulatory framework and ensure compliance in the digital asset sector. The updated application process is accessible via the SEC ePortal, emphasizing the importance of timely submission.

In March, Nigeria introduced new rules to license, register, and inspect VASPs, reflecting the country's increased scrutiny of the digital asset market. This regulatory shift came as Binance, a prominent cryptocurrency exchange, stopped offering Nigerian Naira services due to the enhanced regulatory environment. The SEC launched the Accelerated Regulatory Incubation Programme (ARIP) to facilitate compliance with the new rules.

The SEC has established a special window for VASPs to participate in ARIP through the SEC ePortal, requiring completion of application updates within 30 days. Non-compliant VASPs will face regulatory actions, emphasizing the seriousness of adhering to these new directives. The SEC recently revised its rules on digital assets issuance, offering platforms, exchange, and custody, signaling a shift towards more responsible regulation.

The proposed amendments aim to create structured rules, including increasing the registration fee for crypto exchanges from 30 million naira to 150 million naira. This significant hike aims to ensure only financially stable and compliant entities operate in the sector. Nigeria has emerged as a major player in the global crypto market, ranking second in terms of cryptocurrency adoption in 2023. The new regulations seek to balance growth with necessary oversight for secure and compliant development.

In conclusion, the Nigerian SEC's 30-day deadline for VASPs to update their applications reflects the country's commitment to regulating the digital asset sector. The new regulations aim to strike a balance between growth and oversight, ensuring a secure and compliant market for all stakeholders. VASPs must prioritize compliance to avoid regulatory actions and contribute to the development of a robust digital asset ecosystem in Nigeria.