• bitcoinBitcoin$18,806.00-6.62%
  • ethereumEthereum$1,284.70-7.08%
  • elrond-erd-2Elrond$46.05-3.64%

Osinbajo: “Cryptocurrency Should Be Regulated, Not Banned”

Yemi Osinbajo, the Vice President of Nigeria, commented yesterday that the government should try and create a strong regulatory regime based on thought and knowledge, instead of adopting a policy that bans cryptocurrencies in the country.

He urged Nigerians to act using knowledge and not out of fear. Osinbajo declared that he appreciates the strong positions taken by the CNB and SEC regarding the possible illegal use of crypto, but that said positions ought to be reflected upon further.

Osinbajo commented: “There is a role for regulation here. And it is in the place of both our monetary authorities and SEC to provide a robust regulatory regime that addresses these serious concerns without killing the goose that might lay the golden eggs.

“So it should be thoughtful and knowledge-based regulation, not prohibition. The point I am making is that some of the exciting developments we see call for prudence and care in adopting them, but we must act with knowledge and not fear.”

Regarding the need of monetary authorities to rethink their views on crypto, the VP said: “There is no question that blockchain technology generally and cryptocurrencies, in particular, will in the coming years challenge traditional banking, including reserve (Central) banking, in ways that we cannot yet imagine. So, we need to be prepared for that seismic shift. And it may come sooner than later.

“Already remittance systems are being challenged. Blockchain technology will provide far cheaper options for the kind of fees being paid today for cross-border transfers. I am sure you are all aware of the challenge that the traditional SWIFT system is facing from new systems like Ripple which is based on the blockchain distributed ledger technology with its own crypto tokens.

“There are, of course, a whole range of digital assets spawned daily from block-chain technology. Decentralized finance, using smart contracts to create financial instruments, in place of central financial intermediaries such as banks or brokerages is set to challenge traditional finance. The likes of Nexo finance offer instant loans using cryptocurrency as collateral. Some reserve banks are investigating issuing their own digital currencies.”

Prof. Osinbajo Makes a Point

When talking about national development and the public and private sector interventions, Osinbajo declared: “In order to engender sustained economic growth, we must think in terms of scale.

“I am quite concerned when I hear that national interventions are classified as pilots involving sometimes no more than 1000 people. Given the size of our population, we cannot afford the luxury of pilot projects. We should design our interventions very carefully and then go big.

“It was quite puzzling to me when people said that our plan to build 300,000 houses under the ESP was too ambitious a target. After all, this amounts to 400 houses per local government yet many of our local governments are larger than some African countries who would not consider building 400 houses in one year as too onerous a task.

“The task of national development requires that we fire on all cylinders after all, at one stage, China was building 1.9m housing units per year over a number of years.”

The VP also touched on the need to complement the efforts of the Federal Government in managing to bridge the infrastructure gap and mentioned that the Buhari administration had a decent track record in building the needed infrastructure, such as roads, and power projects across Nigeria.

“In spite of this commitment, we are still very far away from meeting the full infrastructural needs of the economy,” Osinbajo mentioned and called for more support, especially from the private sector, in regards to the operationalization of the Infrastructure Company (InfraCo).

“The President has now approved the establishment of InfraCo which will be a public-private partnership chaired by the CBN Governor to overcome our infrastructural deficits. I expect that this is a project that will excite the interest of financiers and bankers and I encourage you all to lend support to make it a success,” Osinbajo added.

Previous articleNext article

Leave a Reply

Your email address will not be published.