The Director-General, SEC, Lamido Yuguda, said this at the 2021 first post-Capital Market Committee (CMC) virtual news conference.
Mr. Yuguda said the commission was in discussion with the CBN for a better understanding and regulation of the crypto assets.
He said the commission suspended the implementation of crypto assets guidelines due to a lack of access to Nigerian bank accounts.
“We are in discussion with CBN for both understanding and better regulating of this market.
“We will be able to come back to you later to inform you of the outcome of these engagements.
“But because of the lack of access to commercial bank accounts, we had to suspend our own guidelines of September 2020, the implementation of that circular is suspended until these operators are able to have access to Nigerian bank accounts.
“Remember that nobody operates in the Nigerian capital market if that person does not have access to a Nigerian bank account,” he said.
Mr. Yuguda, however, said that SEC remained very supportive of Fintechs and had invested so much in developing a framework to support their operations.
The comments followed last week’s declaration by the SEC that fintech allowing Nigerians access to foreign securities were operating illegally. Examples of those platforms are Bamboo, Rise vest, and Chaka.
“Let me say that the SEC remains very supportive of fintech. We have invested so much in developing a framework for supporting fintech in the various areas and fintech are acting in areas of crowdfunding, investment advice and cryptocurrencies and the like,” he said.
Mr. Yuguda said that the market had been disrupted by the apex bank prohibition on access to Nigerian bank accounts by the crypto exchange.
“In all other areas, nothing has changed, but in the area of crypto assets, you know that with the recent prohibition by the CBN on access to Nigerian bank accounts by crypto exchanges, that market has been disrupted.
“And the truth of the matter is that while the SEC had issued guidelines in September 2020 aimed at regulating this market, for now for all intents and purposes, because these exchanges do not have access to commercial bank accounts in Nigeria the market, for now, does not exist,” he said.
According to him, the commission recognises the impact of FinTechs on capital market activities.
He assured the public that SEC would remain accommodative of this development.
“We shall continue to engage players and support them to operate lawfully.
“Our aim is to ensure the delivery of safe products and services without stifling innovation,” Mr Yuguda said.
He, therefore, encouraged FinTech firms to approach the Commission for due registration and desist from operating illegally.
Tesla Stops Accepting Bitcoin Over Rising Use of Fossil Fuels in Bitcoin Mining, Transactions
Tesla Inc., an American electric vehicle and clean energy company, on Wednesday announced it has stopped accepting Bitcoin as payment for its vehicle.
The company’s Chief Executive Officer, Elon Musk, disclosed this in a tweet.
Musk said “Tesla has suspended vehicle purchases using Bitcoin. We are concerned about rapidly increasing use of fossil fuels for Bitcoin mining and transactions, especially coal, which has the worst emissions of any fuel.
“Cryptocurrency is a good idea on many levels and we believe it has a promising future, but this cannot come at a great cost to the environment.”
The billionaire further stated that Tesla will not be selling its holding of Bitcoin until mining transitions to more sustainable energy.
He said “Tesla will not be selling any Bitcoin and we intend to use it for transactions as soon as mining transitions to more sustainable energy. We are also looking at other cryptocurrencies that use <1% of Bitcoin’s energy/transaction.”
Bitcoin plunged by 17 percent from $54,800 per coin to as low as $46.294 per coin before moderating to $50.656 per coin while Ethereum, XRP, and Dogecoin declined by 9.09 percent, 10.73 percent and 10.28 percent, respectively.
In March 2021, Elon Musk announced that customers in the United States can now purchase Tesla vehicles with Bitcoin.
This was despite Bill Gates, Janet Yellen and others complained about Bitcoin energy consumption and its impact on the globe going forward.
While Musk seems to have downplayed their concerns in March, the Billionaire is now pushing for exactly the same thing after accumulating enough Bitcoin. A move now criticized by millions of cryptocurrency lovers globally.
Nic Carter, founding partner at Castle Island Ventures, and a leading voice among defenders of Bitcoin’s energy use, said Elon Musk should have done his due diligence before accepting Bitcoin.
“Surely he would have done his diligence prior to accepting Bitcoin?’ Carter said. “Very odd and confusing to see this quick reversal.”
Others started pushing Dogecoin as a replacement for Bitcoin while some suggested Tether on the Tron network has the lowest energy consumption presently and it is a stable coin.
Ethereum Market Cap Surpasses JPMorgan As It Hits A New ATH
Ethereum, the world’s second-most valuable digital currency, spiked nearly 10 percent in the last 24 hours and reached an all-time high of approximately $4,370.
According to the latest data published by Coinmarketcap, Ethereum now has a market cap of more than $500 billion. ETH becomes only the second cryptocurrency in the world to reach a market value of $495 billion.
Ethereum is now more valuable than the world’s leading investment bank JPMorgan. The total market cap of JPMorgan Chase currently stands at around $480 billion. ETH has been on the rise since the start of 2021. The cryptocurrency crossed the market cap of the Bank of America and PayPal earlier this year.
ETH whale activity has increased during the last few weeks amid a surge in its price. Yesterday, Finance Magnates reported about the movement of 46,793 Ethereum from a digital wallet to cryptocurrency exchange Binance.
“Ethereum top stakeholders have been historically active over the past week, with one 4-hour window on 5 May seeing over 6,300 $100k+ ETH transactions. This explosion in activity beginning on 3 May had much to do with the inevitable rise to $4,200,” on-chain analytics firm Santiment mentioned on Twitter.
The latest price surge in ETH has made Vitalik Buterin, Co-Founder of Ethereum, one of the youngest crypto billionaires after his public Ethereum address crossed 333,520 ETH, which is approximately $1.4 billion in value.
Ten Things You Should Know Before Buying Your First Cryptocurrency
If you just started paying attention to cryptocurrency and are wondering whether to invest, here are 10 things you need to know before buying anything.
Even if you’re an old pro, you probably know someone who’s curious because they heard on TV or at the bar that the price of some coin is surging and they can get rich quickly trading it. Please share this post with him or her.
1. Don’t put in more than you can afford to lose
Crypto is riskier than many other investments. Nothing is guaranteed other than volatility. What’s more, it’s unregulated in most cases. There is no FDIC insurance for this stuff, nor is there a buyer of last resort. The prices of crypto coins swing wildly from minute to minute. While the market is basking in the glow of bull run, it has endured painful and protracted corrections and almost certainly will again.
Danger varies in degree. Bitcoin, the original cryptocurrency, has been around for more than a decade and it’s significantly less likely to disappear than most other coins. But it’s not free of risk either.
Hence, don’t bet the proverbial farm, or your life savings, on any coin.
2. Research thoroughly
Before you invest a significant amount of money in any digital currency, spend hours upon hours researching the technology so you understand the value proposition and the risks. (“Someone else will buy it from you for a higher price” is not a value proposition.)
Read everything you can find on the topic. (CoinDesk’s Learn section is a fine place to start, and our Research Hub can be your next stop.) Lurk on community forums and developer mailing lists. Listen to podcasts. Borrow books from the library, not only about digital currency but related fields like cryptography, game theory and economics. Read CoinDesk and even some of our competitors.
Go to local meetups, if your area is no longer on COVID-19 lockdown. Ask lots of questions. If you don’t understand what you’re hearing, don’t be afraid to ask someone to explain. If it is still not making sense, don’t assume that’s on you; people could just be talking gobbledygook. The sincere ones will take the time to help, but even then be wary of people “talking their book” (telling you to buy what they own so the price goes up).
And even if you’re convinced, seek out skeptics (there is no shortage of them) and consider their arguments as well. Remember John Stuart Mill: “He who knows only his own side of the case knows little of that.”
Once you think you’ve researched everything there is to know, do even more work. You’re probably not done yet.
3. Resist “fear of missing out”
If the only reason you’re investing in something is to avoid missing out, the only thing you won’t miss out on is losing everything.
Fear of missing out (FOMO) is a sure way to destroy whatever wealth you may have accumulated over the years. The problem is that it’s a gut reaction to something that should be researched first. Trading based on your gut will quickly lead to an upset stomach.
Know what you’re buying. Really know it. Going on a trading app and seeing a currency is up 30% or so over the past 24 hours isn’t research. It could be you’re the unlucky sap being sold a falling cryptocurrency.
Every coin has pumpers (shameless promoters), even bitcoin. Don’t succumb to peer pressure. This isn’t high school. Think for yourself and evaluate the case for an investment on the merits.
Research. Then research again.
4. If it sounds too good to be true, it probably is
Much like Wall Street, the U.S. Congress or the American Bar Association, crypto is rife with charlatans. There are more than enough people promising their project will be the one to overtake bitcoin. But is it? There’s only one way to find out: Research.
Buyer beware, but also borrower beware. Some crypto exchanges offer more than 100x leverage, meaning you can borrow up to 99% of the cost of an investment. This will juice your profits if a coin goes up in value, but if it goes the other way you could quickly be wiped out.
5. Don’t trust, verify
Scammers abound in this market. Just this past weekend, some rascals on Twitter took advantage of Elon Musk’s appearance on television’s “Saturday Night Live” to defraud people out of $100,000 worth of various cryptos with a bogus “giveaway.” Impersonating the comedy show’s Twitter account, the miscreants instructed their victims to send small amounts of crypto to verify their addresses. If they did so they would get 10 times the amount back.
6. Beware of ‘unit bias’
Just because a coin is trading around $1 does not mean it’s “cheaper” than bitcoin at $58,000. Not all coins are created equal.
There are literally thousands of cryptocurrencies, some of which seek to emulate bitcoin and some of which try to solve other issues. They all have varying levels of developer support and decentralization.
Determining the value of a coin means asking how and why was the coin created. What is its supposed utility? Who is working on it? How big is the developer community? How active is the repository on GitHub, where updates to the open-source software are usually logged? Like a building, a codebase requires maintenance, and neglect can leave a structure unsound.
Crucially, what is the coin’s security model – proof-of-work, proof-of-stake or something else? If it’s the former, how does the hashrate compare to other PoW coins? If you don’t know what these terms mean, you’re not ready to invest.
7. Not your keys, not your coins
Cryptocurrency is a bearer asset like cash or jewelry, meaning the holder is presumed to be the rightful owner. Once it’s lost or stolen it’s gone.
That is why advanced users will advise you not to entrust the cryptographic keys to a digital currency wallet to a third party, such as an exchange, because these firms are largely unregulated in many places and may be subject to hacks or exit scams (absconding with clients’ money).
Decentralized finance (DeFi) platforms have fallen prey to numerous high-profile exploits over the past 10 months, and centralized platforms like Binance have been subject to their fair share as well.
However, safeguarding keys yourself, on a hardware device or even a piece of paper with the string of numbers and letters written on it, can be a nerve-racking business, and it’s easy to mess up. This is why even some experienced investors prefer to use third-party custodians.
Crypto is all about trade-offs. Do you trust yourself not to lose that piece of paper or forget the “seed phrase” (a password for a key that unlocks your crypto)? If not, you have to be comfortable with someone else storing your digital valuables, and history gives you every reason not to.
(To mitigate the risks, there is something called a multi-signature wallet. These can be configured so that, for example, both Bob and Alice must sign off on a transaction to release funds from a wallet, or either Bob or Alice can do so, or three of Bob and Carol and Ted and Alice, and so on. But yes, it’s complicated.)
Aside from exploits, exchanges may block you from withdrawing your funds at any time for a variety of reasons ranging from solvency issues to legal trouble. Even beyond that, some exchanges just don’t have the infrastructure necessary to remain up at all times – Coinbase and Robinhood, for example, often go down during periods of market volatility. If you aren’t running your own wallet, you can’t guarantee you have control over your coins.
That said, there are various reasons why you might want to use an exchange, so it’s important to check the user agreements and make sure you’re protected against different eventualities.
8. You can buy a fraction of a bitcoin (and most other cryptos)
You don’t need to buy a whole coin. Bitcoin, for example, is divisible to the eighth decimal. So if you’re curious about how this stuff works, you can purchase as little as $10 worth and just play around with it.
As billionaire Mark Cuban recently said on television of buying small amounts of dogecoin, “it’s a whole lot better than a lottery ticket.” Unfortunately, he also encouraged viewers to spend doge on merchandise without mentioning the tax implications (see below).
9. Understand the tax consequences
This is especially important in the U.S., for several reasons. First, the Internal Revenue Service (IRS) considers crypto property, not currency, for tax purposes. The upshot is if you buy a coin for $1 and it doubles in value and you spend that extra dollar to buy so much as a pack of chewing gum, you are required to report that capital gain and pay tax on it. There is no “de minimis exemption,” despite the crypto industry’s lobbying efforts.
Also, centralized exchanges regularly send account information to the IRS. Sure, crypto isn’t as regulated as stocks or banks. However, the federal government is running a massive deficit and it won’t think twice about sending in folks with mirrored aviator glasses to visit you to ask about your crypto trades.
10. Buy using dollar cost averaging and don’t obsess about price
Go outside. Get some fresh air, exercise and sunshine. Spend time with your family. You can do all that AND invest in crypto.
The markets will fluctuate from day to day, hour to hour, minute to minute, but any crypto worth a damn, any investment of any kind worth a damn, is a long-term bet. If you want a dopamine hit, go for a run or watch an action movie.
If you have a long-term view, you’re not going to be pressured to sell or up your position based on short-term movements if you use DCA.
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