New York, Friday, August 16, 2024 – OKX, a prominent cryptocurrency exchange, has announced its decision to discontinue operations in Nigeria, citing unfavorable regulatory conditions. The move, which takes effect on August 16, 2024, follows similar exits by other major exchanges such as Binance and KuCoin, marking a significant shift in Nigeria’s crypto landscape.
Reports citing an email by OKX on July 18, 2024 say that OKX is discontinuing OKX services in Nigeria after recent changes in local laws and regulations.
The email advised users to withdraw their funds and close open positions by 12:00 am PST on August 16, 2024, after which only withdrawals will be possible.
OKX had already suspended some of its services, including peer-to-peer (P2P) trading, earlier in 2024, as the federal government intensified its crackdown on cryptocurrency firms.
Nigerian authorities have scrutinized exchanges, viewing them as facilitators of speculative trading and potential manipulation of exchange rates. Other exchanges like Coinbase and Quidax have also faced similar challenges.
The Nigerian Securities and Exchange Commission (SEC) has further tightened its grip on the sector by introducing the Accelerated Regulatory Incubation Program (ARIP), requiring local crypto firms to apply for registration within 30 days. The ARIP mandates that applicants meet strict eligibility criteria, including incorporation in Nigeria and having a resident CEO.
As OKX exits, the Nigerian crypto community, particularly the youth who have relied on digital currencies for financial empowerment, faces uncertainty. The departure underscores the growing regulatory challenges in the country and raises concerns about the future of Nigeria’s burgeoning crypto ecosystem.
ARIP introduced by the Nigerian SEC imposes strict conditions on local cryptocurrency firms.
To qualify, companies must be incorporated in Nigeria, have a resident CEO, and engage in investment or securities business. Additionally, they must demonstrate provisions for investor protection and public interest. Firms are required to apply for registration within 30 days, during which the SEC will evaluate their operations and amend regulations as necessary. This program aims to bring all virtual asset operators under regulatory oversight while the SEC continues to assess and refine the sector’s legal framework.
