Bridging the Trust Gap
The Nigerian Securities and Exchange Commission (SEC) is exploring the use of blockchain technology to build trust in capital markets. According to Director-General Emomotimi Agama, harnessing this technology is key “to bridging the [trust] gap between issuers and investors.”
At a conference of the Capital Market Correspondents Association of Nigeria, Agama explained how adopting the technology benefits all investors, including those in neglected parts of the country.
“The SEC is exploring the integration of blockchain technology for secure and transparent transaction processing, a step that will redefine trust in the market,” Agama reportedly said.
The revelation that the SEC is weighing the prospect of leveraging blockchain comes as the Nigerian government itself has moved to integrate the technology. Nigeria adopted a blockchain adoption policy in early May 2023 and a year later reconstituted the blockchain policy steering committee.
Furthermore, in 2022, the country’s National Information Technology Development Agency committed to training 30,000 individuals on blockchain technology. Nearly two years later, it was announced that the Nigerian Institute of Social and Economic Research (NISER) had partnered with the Japanese tech firm Soramitsu. The partnership aims to build Nigeria’s knowledge base and support its development through research and innovative blockchain projects.
Meanwhile, a Punch report quotes Agama suggesting that the oversubscription of most recapitalization offers this year indicates strong investor confidence. To sustain this momentum, the SEC boss said the regulator has “intensified efforts to enhance disclosure standards and corporate governance practices.”
Agama, widely seen as a pro-innovation figure, also suggested that the success of recapitalization efforts will depend on cooperation among stakeholders.
“Developing innovative financial products, such as green bonds and sukuk, to attract diverse investor segments is crucial. The success of recapitalization efforts depends on collaboration among regulators, issuers, and investors,” the SEC director-general said.
