SEC sets amount to be raised from digital currency offerings at N10 billion

DG SEC, Dr. Lamido Yuguda

FIRS

The Securities and Exchange Commission (SEC) has set the maximum amount to be raised from the offering of digital assets within 12 months at N10 billion.

The limit is contained in the Commission’s new rules on the issuance, offering platforms and custody of digital assets.

These rules, according to the Commission, would apply to issuers seeking to raise capital through offerings of digital assets.

He defined Digital Asset as a digital token that represents assets such as a claim or claim on the issuer; and include the Initial Coin offering and other Distributed Ledger technology digital asset offerings.

The new rules stipulated that the issuer had to demonstrate that the gross proceeds to be made from the offering of digital assets would be sufficient to undertake the project as proposed in the whitepaper.

He said: “An issuer can only raise funds subject to the following limit: Twenty times the issuer’s shareholder funds, i.e. the maximum amount of funds that can be raised during a rolling period of 12 months, subject to a cap of N10 billion or such other cap as the Commission may determine from time to time.

“The issuer must demonstrate that the gross proceeds to be derived from the digital asset offering would be sufficient to undertake the project as proposed in the whitepaper.

“In the event that the amount raised is less than the soft cap, the issuer will repay all monies collected from tokenholders within five business days from the closing date of the offering.”

Regarding the investment limit, the Commission stated in the document that a person can invest in an initial offering of digital assets subject to the various limits.

For qualified institutional and high net worth investors, he noted that there will be no restrictions on the amount of investment.

But for retail investors, the document sets a maximum of N200,000 per issuer with a total investment limit of no more than N2 million within 12 months.

He said, “A person may invest in an initial offering of digital assets subject to the following limits: “For qualified institutional and high-income investors, no restrictions on the amount of investment; and for retail investors, a maximum of N200,000 per issuer with a total investment limit not to exceed N2 million in any 12 month period.

Moreover, as the Russian-Ukrainian crisis lingers, Nigeria and other African countries are set to launch a platform to aggregate essential commodities and enable African countries to access scarce commodities. The platform, known as the Africa Trade Exchange (ATEX), will pool-buy commodities in bulk and ensure that countries have access to scarce supplies in a transparent and fair manner.

Following the Russian-Ukrainian crisis, India banned the export of wheat while Indonesia did the same for palm oil. The platform will be anchored by AFREXIM Bank in collaboration with the AfCFTA Secretariat and UNECA. by the United Nations Economic Commission for Africa (UNECA).

“ATEX represents only a fraction of Africa’s economic and innovative potential, but it promises a transformation in the continent’s approach to imports and trade,” ECA said. The funding will come from the African Development Bank’s $1.5 billion emergency food production plan to mitigate the effect of the Russian-Ukrainian war on food prices through rapid production of wheat, corn, rice and soybeans.

UNECA described ATEX as “a digital business platform, which will complement the digital ecosystem built to support the implementation of the African Continental Free Trade Area (AfCFTA) agreement.”

ATEX, the UN agency added, “will help realize the development potential of e-commerce and digitalisation, in particular by facilitating the access of small and medium-sized enterprises (SMEs) to the wider African market”.

This, he said, “will strengthen intra-African trade and Africa’s trading position in the global market, helping to adapt to supply chain disruptions and the continued growth of African businesses and economies. “.

He added: “To support supply chain resilience, ATEX will enable digital trade in key agricultural commodities and inputs imported by the continent from Russia and Ukraine: grains (including wheat, maize and grains), fertilizers and associated inputs, oils, oilseeds, as well as other essential products and inputs to support agricultural value chains”.

ECA said, “The platform will facilitate the joint sourcing by African buyers of these products from African suppliers where possible, such as in the case of fertilizers; and from outside the continent if necessary, as in the case of cereals and seeds”.

This, UNECA explained, would contribute “to the creation of new continental supply chains that will insulate Africans from the volatility that has characterized recent years”.

According to UNECA, “just like the solutions developed in the pandemic, ATEX constitutes an African innovation designed to address another crisis facing the continent – it is a measure that the wider international community should support and from which we can all learn”. ECA noted that “through this program and others like it, Africa is showing leadership and ownership of its own challenges”. “To say this is an African solution to an African problem is not to dismiss or discourage international collaboration – indeed, our global partners will play a central role in ensuring that Africa is included in the conversation on supply chain resilience,” the ECA said. ECA has urged Africa to “develop a safer and more stable mechanism to obtain.

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essential raw materials and cultivate stronger intra-African links between suppliers”. The Russian-Ukrainian crisis has increased pressure on critical supply chains in commodity markets, with current and projected price increases for agricultural products and inputs such as grains and fertilizers. Aggregating Africa’s demand for these products will allow the continent to negotiate competitive prices, especially for cereals and grains, while ensuring net food importers access and affordability of products like wheat and corn. UNECA also argues that “aggregation of fertilizer demand from importing countries can provide African producers with inputs such as fertilizers, ensuring speed and affordability, and thereby reducing the risk of food shortages.”

Sylvia B. Polson