The Securities and Exchange Commission (SEC) has granted “Approval-in-Principle” to two digital asset exchanges, Busha Digital Limited and Quidax Technologies Limited, enabling them to commence operations under its Accelerated Regulatory Incubation Program (ARIP). This decision marks a significant step in the SEC’s effort to regulate and oversee the burgeoning digital asset sector.
Busha Digital Limited and Quidax Technologies Limited have been given the green light to operate, joining the ARIP, which aims to support digital asset firms that began operations before the SEC’s Virtual Asset Service Providers Rules were introduced in May 2022. The ARIP is designed to fast-track regulatory approvals for firms that have demonstrated compliance and operational viability.
In addition to these approvals, the SEC has also admitted five other firms to its Regulatory Incubation (RI) program. The firms are Trovotech Ltd, Wrapped CBDC Ltd, HousingExchange.NG Ltd, Dream City Capital, and Blockvault Custodian Ltd. This program provides a platform for testing innovative business models and technologies in a real-time market environment, under close supervision by the SEC.
Busha Digital Limited: Busha operates a digital exchange platform that allows users to buy, sell, store, send, receive, trade, invest, and make payments using cryptocurrencies. The platform is accessible via both mobile and web applications.
Quidax Technologies Limited: Quidax provides a cryptocurrency trading platform that utilizes blockchain technology to list and trade crypto tokens. The platform offers both web and mobile access and includes a digital wallet feature for storing, receiving, and transacting in various cryptocurrencies.
The ARIP and RI programs reflect the SEC’s commitment to fostering innovation while ensuring investor protection and market integrity. The ARIP is focused on onboarding firms that had started operations before the new rules were established, while the RI program is dedicated to assessing new business models and technologies in the digital asset space.
The SEC has highlighted that the current cohort of the ARIP and RI programs includes firms leveraging distributed ledger technology (DLT) for creating and trading crypto assets. The results from these programs will guide future policy developments and regulatory adjustments.
The approvals granted are preliminary and aim to ensure that firms meet appropriate protection and transparency standards before full registration is granted by the SEC. Testing will be conducted on a short-term and small-scale basis, with the SEC working closely with the firms to establish testing parameters and robust consumer safeguards.
