Adedeji Owonibi is calling for Nigerian cryptocurrency regulation to combat financial crimes and ensure the security and scalability of the sector, addressing the complexities of tracking illicit transactions.
Calls for regulation of cryptocurrency in Nigeria have increased, highlighting the urgent need to tackle financial crimes, especially money laundering, within the fast-growing digital currency space. Adedeji Owonibi, the co-founder of A&D Forensics, is at the forefront of this advocacy and emphasizes the role of regulation in curbing these illegal activities. His insights shed light on the complexities and challenges of cryptocurrency transactions and highlight the need for government intervention through regulation.
Owonibi’s position on this is clear; Without strict regulation, Nigeria’s cryptocurrency sector remains a fertile ground for financial crimes. He states that the Nigerian government should enact comprehensive laws governing cryptocurrency activities to deter and mitigate the risk of money laundering and other financial crimes. This perspective is especially relevant now that the Central Bank of Nigeria (CBN) has lifted its ban on crypto transactions, allowing banks to manage accounts for Virtual Asset Service Providers (VASPs).
The importance of such regulation cannot be overstated, especially considering Nigeria’s position as a major player in the global cryptocurrency market. Despite previous regulatory challenges, including a ban by the CBN, the use of cryptocurrency in Nigeria has seen a remarkable rise. The country features prominently in global crypto adoption indices, driven by factors such as limited access to traditional banking services, currency devaluation and inflation. However, this increase in crypto activity also raises the specter of increasing financial crimes, making the call for regulation all the more important.
Owonibi’s insights also highlight the potential of regulatory frameworks to improve safety scalability of the crypto industry. He points to the development regulation of the National Information Technology Development Agency (NITDA) as an important step towards creating an enabling environment for the growth of the blockchain and crypto industry. This move, according to Owonibi, is what the CBN should have considered in 2021 instead of cutting ties between cryptocurrency exchange companies and local banks.
Additionally, Owonibi delves into the intricacies of detecting and investigating cryptocurrency fraud, revealing that while Over-The-Counter (OTC) transactions and crypto mixers pose challenges for law enforcement, improvements in regulatory technology and international cooperation improve the ability to detect illegal activities. . He highlights the evolving landscape of blockchain anonymity and global efforts to establish standards for transaction traceability, underscoring the importance of regulatory action in combating cryptocurrency scams.
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