Senator Ihenyen is a tech lawyer with an interest in policy and regulations. He is the current President of Stakeholders in the Blockchain Technology Association of Nigeria (SiBAN). In an interview with Technext, Senator (that’s his real name by the way) sheds more light on his mission to transform Nigeria into the safest blockchain space in the world.
He was a managing associate at Assizes Lawfirm when he first came across blockchain technology. But it was not until 2017 when he founded Infusion Lawyers, a tech-focused law firm, that he started taking a deeper interest in blockchain technology.
In 2019, he became the Vice Chairman, Policy & Regulations at SiBAN and since then, there has been no looking back. From business to policy and regulations, he has continued to dig deep into the world of blockchain. According to Senator Ihenyen, a distinctive attribute of the blockchain technology that caught his fancy was:
“The ability to enable the exchange of anything of value—from shares to intellectual property, digital identity to electronic votes, etc— without any third party or central authority. This is unprecedented in human history.”
A bit about SiBAN
Blockchain technology and its various applications, particularly in the financial industry, are quite disruptive, creating risks and opportunities at the same time.
This made Innovators who found themselves building products and services realise that they needed to collaborate with other stakeholders to ensure that they self-regulate the nascent industry.
So, in 2019, some industry players came together to found what was then the Nigerian Blockchain Association. It was all about promoting blockchain innovation, awareness, adoption, and coming up with ways to ensure regulation does not stifle innovation. Today, that association is called the Stakeholder in the Blockchain Technology Association of Nigeria (SiBAN).
“SiBAN was established to protect the blockchain and crypto industry from bad actors, ensuring consumer protection and investor safety. Education is key to what we do, and well as advocacy in blockchain policy and regulations.” – Senator Ihenyen.
Senator says leading the foremost blockchain association in Nigeria has been quite a journey—a challenging, demanding, and rewarding journey at the same time. He remarks that the mission was to unite all stakeholders in the space but it was a herculean task trying to get them all on the same page.
“But Mr Ezeafulukwe was a great leader and unifying force. After his two-year administration when I served as General Secretary, I was elected President in December 2020. Since then, the focus has largely moved from bringing stakeholders together to focusing on our vision and mission as a blockchain association. Our vision at SiBAN is to transform Nigeria into the world’s safest and biggest blockchain space with the largest blockchain solutions, investments, and adoption.”
Senator Ihenyen and his Executive Council have remained committed to the cause of helping to reposition Nigeria’s emerging blockchain industry on the global map. And those efforts are yielding good results today. Nigeria is known to be a leading market in crypto adoption and SiBAN is globally recognized as the most innovative and the strongest blockchain association in Africa.
“Today, we collaborate with both innovators and regulators, and it is a thing we are very proud of. There is however a lot more we can do, and we will do.”
– Senator
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One of the major challenges Senator Ihenyen and SiBAN have faced is the lack of recognition of innovators or operators as virtual assets service providers (VASPs) in Nigeria, particularly in the banking and financial system in the country. But he says gradually, through consistent engagements with key regulators, including SEC, this is gradually changing.
Today, Nigeria’s capital market recognises VASPs and digital assets/virtual assets. So does the new Money Laundering Act 2022.
“At SiBAN, as a pro-innovation and pro-regulation association, we expect that current gaps between the CBN particularly and the VASPs industry will be gradually closed. We will continue to push for responsible innovation and responsible regulation in Nigeria’s best interest.”
SiBAN primarily draws membership from both individuals and organizations in the blockchain industry. Individuals include stakeholders in the industry, innovators, users, students and experts. Organisations mainly include operators who offer blockchain or crypto products and services, including blockchain solution providers and crypto exchanges.
Last year, they opened membership to foreign players in Nigeria’s blockchain industry, to reflect the global nature of the blockchain space.
“To become a SiBAN member, you need to meet our membership requirements, including payment of registration fees, meeting our KYC requirements, etc. Effective from June 2022, SiBAN also requires that intending members adopt our Code of Conduct for VASPs. To effectively self-regulate the space, we introduced a Code of Conduct for VASPs who operate in Nigeria.
SiBAN is also open to technology providers, professional & consultancy firms, incubators, blockchain developers, venture capitalists, innovation labs, other associations, school clubs such as university blockchain clubs, policymakers, government agencies, etc.” – Senator Ihenyen.
Blockchain regulation in Nigeria
There are some grey areas in the Nigerian blockchain space that are yet to be fully addressed by the Nigerian authorities, especially the legality aspect. As a stakeholder, Senator Ihenyen sheds a bit of light on the dilemma.
“From my observation, I find that these avoidable inconsistencies and contradictions are due to the fact that some of these regulators or authorities work in silos or do not work collaboratively enough. I think Nigerian authorities need to revisit the National Blockchain Adoption Strategy once more in order to enable Nigeria as a country to have a policy towards blockchain technology in all (key) industries.”
Senator says that from a SiBAN point of view, he agrees with the Central Bank of Nigeria that the risks and threats of the use of cryptocurrency in the banking and financial system in the country raise genuine concerns and require serious attention.
But, as responsible citizens of the country, they also want a sound and safe financial system to promote financial stability to grow a healthy and prosperous nation.
“We do not think that the CBN’s current prohibitory approach is in Nigeria’s best interest, including the financial system. Since the CBN directive, cryptocurrency adoption has continued to grow more than ever before. Inherently decentralised, crypto doesn’t need, at least theoretically, any central force or authority to grow or not grow. In fact, prohibition feeds it fat. Bans empower it. Demonisation makes it a saint.”
According to Senator Ihenyen, how to approach cryptocurrency adoption and regulation is to introduce transparency and accountability through monitoring and supervision which is achievable through the application of Nigeria’s money laundering and terrorism laws, as enacted by the National Assembly of the country.
He commends the introduction of a new Money Laundering Act 2022 by the National Assembly that recognizes virtual assets for AML/CFT purposes.
“At SiBAN, we think that the Nigerian Financial Intelligence Agency(NFIU) has a key role to play in ensuring the level of transparency and accountability cryptocurrency needs in Nigeria through monitoring and supervision of crypto service providers. This approach will benefit us all, including Nigeria, as nothing would be dark or opaque, which has been the fear of the CBN Governor.
Because the SEC has commendably recognised crypto as digital assets within the framework of investments and securities in Nigeria’s capital market, I will not say much about this. SEC is on the right track, but there is of course a lot of room for improvement from a licensing requirement angle.”
Related post: SEC rolls out new guidelines for crypto exchange, companies
As a self-regulatory body in Nigeria’s emerging blockchain industry, SiBAN has made efforts to help regulators and the government see the need to embrace blockchain as an innovation, and consequently maximize the opportunities while also minimizing the risks. Senator says one of the ways SiBAN has tried to influence the Nigerian government’s stance is through engagement and collaboration with regulators and key government agencies.
Senator Ihenyen on police brutality and crypto users
Some Nigerian security outfits often label and extort Nigerian youths that have been found using cryptocurrencies. Senator Ihenyen describes this as unfortunate. He confirms that he regularly receives complaints from some SiBAN members across the country.
” As a legal practitioner, I am not unaware of the fact that there are law enforcement officers who do not involve themselves in the illegal act of harassing or extorting Nigerian youths who are involved in crypto or have crypto apps on their devices. Such officers are mostly the product of training in blockchain and cryptocurrency. They are also aware, unlike some of their colleagues, that the CBN directive on cryptocurrency is not a ban or criminalization of cryptocurrency in Nigeria. So they don’t harass, arrest, or extort people involved in crypto. Both the private and public sectors must invest in training. Capacity building across all cadres is critical.”
Looking ahead
Ihenyen believes that Nigeria will play a pivotal role in the blockchain ecosystem going forward.
He predicts that products and services providers to adopt blockchain in other sectors like agriculture, art & entertainment, sports, health, oil & gas and others apart from crypto. He also sees the crypto industry maturing, becoming regulated and integrated with the financial system.
He told me he is excited about the creation of a new SiBAN ecosystem where they will launch new arms that will help the association.
“These arms will help SiBAN effectively and efficiently drive blockchain & crypto research, education, innovation, policy & regulation, and key partnerships and community. Launched at last month’s P2P Conference, we are more than ever before confident of Nigeria securing her future in blockchain technology for the growth and development of the country.”
Senator Ihenyen says he will continue to focus on using his expertise and experience to maximise the opportunities innovation provides while also helping to minimise the risks. He concludes by saying innovation and regulation have key roles to play in helping Nigeria get it right.
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