SEC tasked on regulatory framework for equity-crowdfunding initiative

The Securities and Exchange Commission has been asked to deliver equity-crowdfunding, which is the needed regulatory framework and agenda for Nigerian digital finance in 2018.
In contemporary and functional terms, crowdfunding means raising money from a large number of people, using the digital platforms. The “large” number of people are reached with the aid of technology. But traditionally, crowdfunding for businesses and charitable causes has been provided by family members, friends, communities and passers-by, as in street begging.
Director, Nigeria Development and Finance Forum, Jide Akintunde, said that 2018 would make it two years since the now-suspended Director General of SEC, Mounir Gwarzo, said he acknowledged the growing interests among Nigerians to use crowdfunding to raise fund.
“SEC needs to deliver the needed regulatory framework this year and advocacies for the enabling regulation should remain strident until that happens,” Akintunde said.
According to him, a modern crowdfunding industry has partially taken off in the country.
“The Securities and Exchange Commission says equity-crowdfunding is outlawed until it puts in place a regulatory framework for it. In the meantime, the donation segment has kept alive a market that can play an important role in financing innovation and small businesses in the absence of venture capital funds,” he said.
He, however, noted that it had become imperative to provide regulatory clarity on cryptocurrencies, adding that until mid-December last year, analysts had looked up to 2018 for answers to questions on whether Bitcoin could sustain its upward price movement over the medium term.
Akintunde said, “From $997 on January 1, 2017, the valuation of Bitcoin rose very sharply to $19,343 on December 16th, according to data by Coindesk. That was 1,838 percent rate of return for investors in the digital currency.
“Bitcoin experienced a price collapse in the third week of December. Since paring its dramatic loss of value, the cryptocurrencies has struggled to sustain an upward trend, ending the year at $13,860.14. Digital currencies, Bitcoin being the runaway leader, will remain in the reckoning of investors in 2018. Bitcoin’s market capitalisation dropped from its peak valuation of $327 billion in mid-December to $224 billion at the end of the year. But the total market capitalisation of the cryptocurrencies reached $593 billion on New Year’s Eve.”
The financial expert explained that digital currency has a symbolic importance for Nigeria and the African continent.
“Africa is expected to leverage the digital economy to close its innovation gap with the advanced economies. The continent is also expected to harness the digital economy to develop economic sophistication that would enable it participate more in global trade,” he said.