An Appraisal of The National Blockchain Policy and Its Likely Impact on The Nigerian Blockchain Ecosystem

By Oyetola Muyiwa Atoyebi, SAN FCIArb. (U.K)

INTRODUCTION

The human world has, without equivocation, been revolutionised by technological advancement. No doubt, technology has played a critical role in the economic and social advancement of the global community and continues to redefine mannerisms and approaches in the different facets of human interrelationships.[1] In recent years, the world has witnessed a convergence, and necessary discourses are springing up on a new trend of emerging technologies aimed at improving efficiency and effective service delivery among the different components and sectors of society. Some of these include quantum computing, cloud computing, bio-tech and bio-manufacturing, edge computing, healthcare analytics, artificial intelligence, internet of things, robotics, Blockchain technology, spatial computing, etc.[2] While these discoveries and innovations have, without gainsaying, been exciting, the legal and regulatory apparatus of each nation in the global comity needs to provide a framework for the adoption, usage, operations, and control of these technologies; otherwise, their full potential may not be harnessed adequately while also occasioning detriments to society. [3]

Blockchain Technology is an advanced system of information sharing and storage within a business network that allows for transparency and immutability within the network.[4] The technology functions in such a manner that it prevents the modification or deletion of data or information on the chain without the consensus of the entire network.[5] It is thus a decentralized, tamperproof, peer-to-peer network that aids transactions among interconnected nodes forming a chain in a transaction block. As an emerging technology, sectors, organizations, and even governments are discovering the potential benefits the technology has for advancing their goals and improving society as a whole, and as a result, they are putting the necessary paraphernalia in place to harness these benefits. In recent years, the usage of the technology has gone past the transfer of digital assets such as cryptocurrencies and is now being made use of in several other sectors such as energy, media and entertainment, law and legal transactions, property transactions, finance, etc.[6]

Nigeria is not left out in the pursuit of the adoption of emerging technologies and improving its digital economy. Nigeria’s digital economy has, in recent years, experienced unprecedented growth, which has concomitantly impacted the Nation’s GDP.[7] This is not unconnected with the nation’s discovery of the importance of technology and the conscious efforts made to encourage a digital society and emerging technologies. In furtherance of this, the nation has in recent times developed the National Blockchain Policy for Nigeria, which serves as a policy framework for the adoption of Blockchain technology in Nigeria in line with the Digital Society and Emerging Technologies pillar of the National Digital Economy Policy and Strategy (NDEPS).[8]

This article will provide an overview of the provisions of the National Blockchain Policy for Nigeria, 2023, as well as its likely impact on the nation’s Blockchain ecosystem.

AN OVERVIEW OF THE NATIONAL BLOCKCHAIN POLICY FOR NIGERIA 2023

The National Blockchain Policy for Nigeria was formally introduced in May 2023 to further the nation’s vision of diversifying the economy. The policy aimed to provide training and capacity-building programs to equip Nigerians with the necessary skills to leverage Blockchain Technology and promote its adoption in the public and private sectors. The policy addresses concerns such as governance, interoperability, security, and regulatory compliance.[9]

According to the policy, Blockchain adoption in Nigeria has many benefits, which include strengthening the digital economy, expanding financial inclusion, enhancing transparency and accountability, and promoting job creation.[10] It emphasizes the importance of talent development, innovation, and adoption as key areas for harnessing the potential of Blockchain Technology in Nigeria.

The policy directs relevant government agencies such as the National Information Technology Development Agency (NITDA), the Central Bank of Nigeria (CBN), the National Universities Commission (NUC), the Securities and Exchange Commission (SEC), and the Nigerian Communications Commission (NCC) to develop regulatory instruments for the deployment of Blockchain Technology across various sectors of the economy.[11]

Moreover, it focuses on talent development,[12] innovation,[13] and Blockchain adoption[14] in financial services, government, and corporate digital services.[15] In furtherance of this, the policy outlines the government’s commitment to making the necessary legal, financial, and human resources available, as well as an enabling environment for their effective utilisation. In partnership with relevant persons, organisations, agencies, international bodies, etc., the government, through its policy, will promote the adoption of Blockchain technology, foster innovation, and encourage the widespread use of the technology across all sectors of the nation.[16] The policy also aims to improve the quality of services delivered by the public and private sectors, catalyze innovation, create jobs, and enhance governance in order to stimulate economic growth.[17]

The expected outcomes of the policy include improved transparency and accountability, enhanced security, financial inclusion, job creation, etc.[18] By creating a supportive environment for Blockchain Technology, the policy aims to attract investment, promote research and development, and foster entrepreneurship. According to PricewaterhouseCoopers, Blockchain Technologies could boost the global economy by $1.76 trillion by 2030.[19]

The implementation structure of the policy involves the collaboration of government organizations, businesses, and other stakeholders to ensure the adoption, innovation, talent development, and responsible use of Blockchain Technology.[20] This will no doubt see the policy serving as a catalyst for innovation and economic growth, leading to the development of new business models, products, and services. The policy also highlights the success of the National Digital Economy Policy and Strategy in realigning the Nigerian economy to take advantage of digital technology.

Overall, the National Blockchain Policy for Nigeria aims to maximize the benefits of Blockchain Technology for the development of the country, laying a solid foundation to achieve its potential in various sectors of the economy.

LIKELY IMPACTS OF THE NATIONAL BLOCKCHAIN POLICY OF NIGERIA ON THE NATION’S BLOCKCHAIN ECOSYSTEM

It is not in doubt that the Nigerian Blockchain eco-space is in its formative stages. As the African continent has been observed to be taking giant strides towards innovation and development in emerging technologies, Nigeria continues to realign itself in this regard to be adequately positioned to exploit the benefits that these technologies offer. The National Blockchain Policy will therefore have a great impact on the improvement and development of the Nigerian blockchain ecosystem in several ways, some of which will be examined anon.

To begin with, the Blockchain policy will serve as a roadmap for Nigeria’s increased innovation in Blockchain in the years to come. It is true that modern society thrives on the ability of its government to set clear standards, principles, and action plans for the development of such a society. This will be reflected in the nature of its laws, policies, etc. Hence, while the Blockchain policy does not in itself possess the force of law, it will serve as the bedrock upon which a legal framework for the adoption, use, and control of the technology will be founded. The existence of adequate laws will, without equivocation, foster innovation in the Blockchain industry, and the existing policy can rightly be regarded as a step in the right direction of the formulation of a legal framework that will provide regulatory clarity, which is crucial for businesses and investors.

Furthermore, the existence of the policy will foster investors’ confidence, innovation, and development. This is because the policy, by its tone, encourages the adoption of the technology and evinces the commitment of the nation’s government to make the necessary resources available, including collaborations with local, regional, and international stakeholders for the improved use and development of the technology. This will thus lead to an influx of investors, developers, and other key stakeholders in the nation’s blockchain ecosystem and, concomitantly, increase its efficiency, transparency, and affordability.

Moreover, as the policy seeks to provide clarity for the nation’s blockchain eco-space, it will, in effect, enhance the development of the ecosystem as a whole. Part of the keynote commitments of the government under the policy is the provision of the necessary support and an enabling environment for blockchain start-ups, encouraging international collaborations on blockchain technology, investment in blockchain education and awareness campaigns, encouraging the adoption of the technology in various sectors such as finance, education, healthcare, etc., and assisting the relevant industry players in identifying and reducing regulatory bottlenecks that may hamper innovation, among others. All these measures, upon implementation, will no doubt enhance the nation’s blockchain ecosystem’s development.

In addition, the policy will in effect foster international collaboration on the development, regulation, and safe use of technology. This will not only result in the attraction of investors and boost investors’ confidence in the nation’s digital ecosystem, but it will also increase the nation’s chances of accessing international aid in the areas of further development of the technology as well as other emerging technologies. This will have an overall positive effect on the nation’s economy and well-being.

Also, the development of the nation’s blockchain ecosystem through the implementation of the policy will lead to job creation as well as boost the nation’s economy. This is because experts will be needed to address fundamental issues in the tech system, and an increased demand for these experts means more job opportunities for people who have the relevant skills. Moreover, it will encourage educational and learning opportunities in order to acquire the relevant skills needed in the tech space.

The likely impacts of the National Blockchain Policy for Nigeria on the nation’s blockchain ecosystem and, consequently, the nation’s digital economy are inexhaustible. Hence, the above represents a few, as the policy seeks to serve as a catalyst for innovation and development in the blockchain tech space in Nigeria.

CONCLUSION

The National Blockchain Policy for Nigeria, recently introduced by the government, has been variously described as a step in the right direction towards the development of the nation’s nascent blockchain eco-space. The policy outlines key areas in which the technology is expected to be adopted, as well as the possible outcomes of the adoption. It is believed that a proper implementation of the policy, which will be manifest in the development of a vibrant legal and regulatory framework, among other courses of action, will foster the nation’s digital economy.

KEYWORDS

Digital economy, blockchain, blockchain technology, national blockchain policy for Nigeria, adoption of blockchain technology,

SNIPPET

The National Blockchain Policy for Nigeria aims to maximize the benefits of Blockchain Technology for the development of the country, laying a solid foundation to achieve its potential in various sectors of the economy

AUTHOR: Oyetola Muyiwa Atoyebi, SAN FCIArb. (U.K). Mr. Oyetola Muyiwa Atoyebi, SAN is the Managing Partner of O. M. Atoyebi, S.A.N & Partners (OMAPLEX Law Firm).

Mr. Atoyebi has expertise in and vast knowledge of Technology Law and this has seen him advise and represent his vast clientele in a myriad of high-level transactions.  He holds the honour of being the youngest lawyer in Nigeria’s history to be conferred with the rank of Senior Advocate of Nigeria.

He can be reached at atoyebi@omaplex.com.ng   

Contributor: Bibiana Adeniji. Bibiana is a member of the Dispute Resolution Team at OMAPLEX Law Firm. She also holds commendable legal expertise in Technology Law.

She can be reached at bibiana.adeniji@omaplex.com.ng

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[1] Anaeto, F. C., et al., ‘The Roles of Science and Technology in National Development’: Direct Research Journal of Social Science and Educational Studies (DRJSSES) [2016] (3), 38–43, at 39, https://directresearchpublisher.org/drjsses/files/2016/12/Anaeto-et-al1.pdf accessed November 21, 2023.

[2] Kufeoglu S., Emerging Technologies: ‘Value Creation for Sustainable Development’ Springer, 1st Ed. (2022), 41. https://www.researchgate.net/publication/361926605_Emerging_Technologies, accessed on 21 November 21, 2023

[3] See ‘Regulatory Technology for the 21^st Century’: A White Paper of the World Economic Forum in Collaboration with the Global Future Council on Agile Governance, (March 2022), p. 3, available at https://www3.weforum.org/docs/WEF_Regulatory_Tech_for_the_21st_Century_2022.pdf, accessed on November 21, 2023.

[4] Vitalik B. et al, ‘Blockchain Privacy and Regulatory Compliance: Towards a Practical Equilibrium’  Social Science Research Network (SSRN) (2023), 1–10, available at https://ssrn.com/abstract=4563364, accessed on November 21^, 2023.

[5] Ibid.

[6] Maheswari, J.U, ‘Blockchain Technology and Its Applications – An Overview.’ International Journal for Research in Applied Science and Engineering Technology (IJRASET), no. 8 (2020): 228–32 available at https://www.academia.edu/43807082/Blockchain_Technology_and_its_Applications_An_Overview accessed on the 21st of November, 2023.

[7] The National Blockchain Policy for Nigeria, 2023, p. 5

[8] The NDEPS is a policy framework and action plan developed by the government in 2019 to realign the Nigerian economy to take advantage of the numerous opportunities digital technology has to offer. See the National Information Technology Development Agency’s Strategic Roadmap and Action Plan (SRAP 2021-2024), available at https://nitda.gov.ng/wp-content/uploads/2021/04/NITDA-ROADMAP.pdf, accessed on November 25, 2023.

[9] Ibid. 11

[10] Ibid. 12

[11] Ibid. 29

[12] Ibid. 19

[13] Ibid. 20

[14] Ibid. 21.

[15] Ibid.

[16] See generally, pp. 19–21.

[17] Ibid. 17

[18] See pp.25-27

[19] ‘Blockchain Technologies could boost the Global Economy US$1.76 Trillion by 2030 Through Raising Levels of Tracking, Tracing and Trust’ (PWC, 2020) available at https://www.pwc.com/gx/en/news-room/press-releases/2020/blockchain-boost-global-economy-track-trace-trust.html accessed on the 25th of November 2023.

[20] See pg. 27 of the Policy..