NEPZA, the Nigerian government agency in charge of export processing zones, announced on Saturday that it is in talks with cryptocurrency exchange Binance to establish a "virtual free zone" dedicated to blockchain technology and the digital economy.
The National Economic and Production Zones Authority (NEPZA) hopes that the end outcome will be comparable to Dubai's online free zone.
Intending to foster sustainable economic growth and lure a wide variety of crypto enterprises to become licensed in the emirate, Binance committed in December of last year to assist Dubai in establishing an industrial hub for global digital assets.
According to Bloomberg reports, the government of Nigeria is in advanced talks with the crypto exchange giant to jointly establish a digital area in the country, which would be a boon to the growth of fintech and digital assets in Africa.
As reported by Bloomberg, the plan would be to build a future digital hub in the vein of Dubai, which has adopted strict restrictions for the promotion and marketing of the bitcoin and blockchain industry.
For some time now, Nigeria, Africa's most populous nation and one of the richest in commodities, especially oil, has been focused on digital assets and blockchain to diversify its economy; this is aided by the fact that Nigeria also has one of the youngest average populations in the world.
Nigeria's growing reliance on the financial technology sector is exemplified by the success of companies like Interswitch Ltd. and Flutterwave Inc. As per the latest data from Chainalysis' Global Index Adoption, Nigeria is the sixth-most-adopted country worldwide for digital currencies.
Since the cryptocurrency market started its spectacular decline in April, CoinGecko found that interest in cryptocurrencies has surged the greatest in Nigeria.
In June, the Nigerian stock exchange announced plans to introduce a blockchain-enabled platform in 2019 in an effort to expand trade and entice younger investors. The Nigerian government has now confirmed its intention to become a major hub for the crypto space by forming a collaboration with Binance.
Nigeria Export Processing Zones Authority (NEPZA) Chief Executive Officer Prof. Adesoji Adesugba, who is widely regarded as the government's primary point of contact in its planned partnership with Binance to accomplish this initiative, said:
Our goal is to generate a thriving virtual free zone to take advantage of a nearly trillion-dollar virtual economy in blockchain and the digital economy.
For Binance, the thought of entering a country with promising potential like Nigeria through this collaboration project is appealing. Eventually, the company hopes to expand its operations throughout Africa.
To avoid the infringement proceedings that have been occurring in many countries over the past three years—and that have led some countries, like Great Britain, to ban the exchange's operations in the country—Changpeng Zhao's exchange has officially started serious cooperation with government and regulatory officials in the countries in which it operates, to obtain a license to run, as obtained recently in Italy and France.
This comes just a few weeks after Binance inked a similarly significant deal with the Korean city of Busan, through which the exchange will ostensibly aid Busan in its blockchain development efforts with technology and infrastructure.
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