The National Blockchain Policy has been approved by Nigeria’s Federal Ministry of Communications and Digital Economy (FMCDE) as the country seeks to create a blockchain-powered economy. The adoption of the policy will allow for the formal utilization of the technology in Nigeria, which has seen significant crypto adoption in recent years. The FMCDE anticipates that the implementation of the policy will have a positive impact on both the public and private sectors of the country.
Push for Blockchain Adoption
The nation’s move towards blockchain adoption is part of Nigeria’s push to diversify its economy from the traditional oil and gas sector to one driven by digital technologies. The Federal Ministry of Communications and Digital Economy developed the National Blockchain Policy to achieve this objective on behalf of the federal government. The policy aligns with the National Digital Economy Policy and Strategy (NDEPS) that was introduced by President Muhammadu Buhari in November 2019. The first draft of the policy was released in October 2020, outlining the strategy that aligns with the FMCDE’s ‘DIGITAL NIGERIA’ Roadmap’s eight pillars of focus.
“The vision of the Policy is to create a Blockchain-powered economy that supports secure transactions, data sharing, and value exchange between people, businesses, and Government, thereby enhancing innovation, trust, growth, and prosperity for all. The implementation of the National Blockchain Policy will have a positive effect on both the public and private sectors of the country.”
The National Information Technology Development Agency (NITDA) will coordinate policy initiatives under the oversight of the FMCDE. A multisectoral steering committee has also been established to monitor policy implementation. Furthermore, the Federal Executive Council directed regulatory bodies, including the NITDA, Nigeria’s Central Bank, the National Universities Commission, the Securities and Exchange Commission, and the Nigerian Communications Commission, to develop regulatory structures for blockchain implementation across various sectors of the economy. However, the Securities and Exchange Commission plans only to support tokenization, focusing on real-world assets and not cryptocurrency.
Nigeria witnessed a cash shortage that led to violent protests earlier this year, making many citizens turn to cryptocurrencies to hedge against inflation and evade the restrictions on naira transactions in online payments. The nation ranked 11th on the Chainalysis 2022 Global Crypto Adoption Index and 17th for peer-to-peer exchange trade volume. According to Binance’s West & East Africa Director Nadeem Anjarwalla, the approved policy demonstrates Nigeria’s positioning as a nation significantly ahead of the curve, with an all-encompassing approach that establishes a blockchain consortium and strengthens the regulatory and legal framework.
“We believe that growth in blockchain technology is set to become a key differentiator for economies and a key measure of international competitiveness in the next decade for attracting foreign direct investment, cultivating innovation, and creating jobs. As such, this is a welcome development and a significant milestone for the blockchain industry in Nigeria.”
Blockchain Tech Adoption Trajectory
Blockchain technology ranks among the fastest-growing technologies in the world and could boost the global economy with $1.76 trillion by 2030, according to PricewaterhouseCoopers (PwC). PwC’s economists expect the majority of businesses to leverage blockchain by 2025, with a projected blockchain GDP of $422 billion.