The Nigerian Securities and Exchange Commission, SEC, might be apparently aligning itself with the decision of the International Organisation of Securities Commissions, IOSCO on Bitcoin regulations.
The IOSCO is the international body of all financial services regulations. The IOSCO Board, consisting of thirty two of the regulators of the leading market in the world, had members in attendance including the Acting Director General of the Securities and Exchange Commission, Dr. Abdul Zubair, who led a high powered delegation to the meeting.
In a recently published communique from the general meeting of the IOSCO, the SEC it participated at the conference that was centered on the Bitcoin and cryptocurrency regulations.
According to the SEC’s communique, deliberations at the meeting centered on cryptocurrencies and bitcoins, data privacy, and asset management. Pertinent questions around the operation of the virtual currencies, the risks involved for investors and markets, as well as the nature of regulation required if at all, were deliberated upon.
The comity of regulators called for caution and care before rushing into regulating the products as this may confer undue legitimacy which may serve to deceive the general public into believing that there is regulatory faith in the products. The need was therefore unanimously agreed for a deep analysis of the nature of the products to enable a clear appreciation of the appropriate perimeter and depth of regulation required to ensure the adequate protection of investors. In view of the general lack of clarity around the products and especially for prospective investors, the regulators were encouraged to launch intensive public awareness initiatives to boost investor education and understanding, and accelerate the development of the right regulatory framework as may be necessary. Recounting how much capital had been lost by investors in similar transactions around the world, the delegates agreed to continue discussions around the subject for the sake of the future of capital markets and players around the world.
In the course of the meeting, two task forces on the very significant topics of data privacy and asset management also presented updates and received relevant guidance and directions from the Board. A focus on these and other important issues will dominate discussions for some time to come. Some of the other issues discussed at the meeting included cyber security, innovation and fintech, artificial intelligence and machine learning, among others.
Speaking at the end of plenary, the Acting Director General, Securities and Exchange Commission, Dr. Abdul Zubair, observed the benefits of tackling the very important issue of cryptocurrencies at this time as it provides an opportunity for regulators especially in the emerging markets, to better prepare for the incursion of virtual currencies into their markets by putting in place the appropriate regulatory frameworks that will ensure transparency, efficiency and protection for investors.
IOSCO is the global standard setting body for securities regulation with a membership covering over ninety five percent of the capital markets in the world. Its members include securities market regulators, self-regulatory organisations, depositories and market intermediaries.