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All You Need To Know About Memoranda & Articles Of Association Under CAMA 2023 Nigeria

By
Emmanuel Ifeanyi Ogbuka
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0

Corporate Law :- Memoranda & Articles of Association Under CAMA 2023- All You Need To Know

This article deals with the topic of Memoranda & Articles of Association being one of the mosr important pieces of documentation required for incorporation and their pursuant regulations as provided under the Companies and Allied Matters Act (CAMA) 2020. 

A memorandum of association is a document which breaks down incorporation information of a company from its shareholder information to its objects clause while a company’s articles are a compilation of its bye-laws beyond which the company cannot act. 

This article will be focused on the requirements for Memoranda if Companies under CAMA 2020, articles of association, registration documents and statement of a company’s objects.

Requirements With Respect To The Memorandum Of A Company

The act provides that :-

-The memorandum of association of every company shall state :

(a) the name of the company ;

(b) that the registered office of the company shall be situated in Nigeria ;

(c) the nature of the business or businesses which the company is authorised to carry on, or, if the company is not formed for the purpose of carrying on business, the nature of the object or objects for which it is established ;

(d) the restriction, if any, on the powers of the company ;

(e) that the company is a private or public company, as the case may be ; and

(f ) that the liability of its members is limited by shares, by guarantee or unlimited, as the case may be.

-If the company has a share capital :

(a) the memorandum of association shall also state the amount of the minimum issued share capital which shall not be less than N100,000.00 in the case of a private company and N2,000,000.00, in the case of a public company, with which the company proposes to be registered, and the division thereof into shares of a fixed amount ; and

(b) each subscriber shall write opposite his name the number of shares he takes.

– A subscriber of the memorandum who holds the whole or any part of the shares subscribed by him in trust for any other person shall disclose that fact and the name of the beneficiary in the memorandum of association.

-The memorandum of association of a company limited by guarantee shall also state that:

(a) the income and property of the company shall be applied solely towards the promotion of its objects, and that no portion thereof shall be paid or transferred directly or indirectly to the members of the company except as permitted by, or under this Act ; and

(b) each member undertakes to contribute to the assets of the company in the event of its being wound up while he is a member or within one year after he ceases to be a member for payment of debts and liabilities of the company, and of the costs of winding-up, such amount as may be required not exceeding a specified amount and the total of which shall not be less than N100,000.

– The memorandum of association shall be signed by each subscriber in the presence of at least one witness who shall attest the signature.

– The memorandum shall be stamped as a deed.

Articles of Association

-A company shall have articles of association prescribing regulations for the company.

– Unless it is a company to which model articles apply by virtue of the relevant provisions of CAMA it shall register articles of association.

-Articles of association registered by a company shall be:

(a) contained in a single document, and

(b) divided into paragraphs numbered consecutively.

– Reference in this Act to a company’s “articles” are to its articles of association.

The Power of a Minister to prescribe Model Articles

-The Minister may by regulations prescribe model articles of association for companies.

-Different model articles may be prescribed for different descriptions of companies.

– A company may adopt all or any of the provisions of model articles.

– Any amendment of model articles by regulations does not affect a company registered before the amendment takes effect.

– In this section, “amendment” includes addition, alteration or repeal.

 

Default Application of Model Articles.

– The act provides that on the formation of a limited company if articles are:

(a) not registered ; or

(b) registered, in so far as they do not exclude or modify the relevant model articles, the relevant model articles form part of the company’s articles in the same manner and to the same extent as if those articles expressly included the relevant model articles in the form in which those articles had been duly registered.

– In this section, the “relevant model articles” means the model articles prescribed by the Commission for a company of that description as in effect at the date on which the company is registered.

Statement of a Company’s Objects

-The act provides that unless a company’s articles specifically restrict the objects of the company, its objects are unrestricted.

-Where a company amends its articles to add, remove or alter a statement of the company’s objects:

(a) it shall give notice to the Commission ;

(b) on receipt of the notice, the Commission shall register it ; and

(c) the amendment is not effective until after the entry of that notice in the register.

– Any such amendment does not affect any right or obligation of the company or render defective any legal proceeding by or against it.

 

Registration Documents

– The act provides that the memorandum of association shall be delivered to the Corporate Affairs Commission (CAC) together with an application for registration of the company, the documents required by this section and a statement of compliance.

– The application for registration shall state:

(a) the company’s proposed name ;

(b) the registered office address and head office address if different from the registered office address ;

(c) whether the liability of the members of the company is to be limited and, if so, whether it is to be limited by shares or by guarantee ; and

(d) whether the company is to be a private or a public company.

– If the application is delivered by a person as agent for the subscribers to the memorandum of association, it shall state the name and address of that agent.

-The application shall contain:

(a) in the case of a company that has a share capital, a statement of initial issued  share capital and initial shareholdings ;

(b) in the case of a company that is limited by guarantee, a statement of guarantee;

(c) a statement of the company’s proposed directors ;

(d) a statement of the proposed registered office of the company ; and

(e) a copy of the proposed articles of association to the extent that these are not supplied by the default application of model articles.

The Capacity & Powers Of Companies Under CAMA 2023

Companies are well known to be juristic persons, meaning that they have legally recognized personalities distinct from those of their directors, founders and members.

This article however looks at the provisions of the Companies and Allied Matters Act (CAMA) on the extent of the powers and capacity granted to companies as well as the exercise of those powers.

Powers of Companies & Prohibition of Donations for Political Purposes

The act (CAMA) provides that :

– Except to the extent that the company’s memorandum or any enactment otherwise provides, every company shall, for the furtherance of its business or objects, have all the powers of a natural person of full capacity.

– A company shall not have or exercise power either directly or indirectly to make a donation or gift of any of its property or funds to a political party or political association, or for any political purpose, and if any company, in breach of this subsection makes any donation or gift of its property to a political party or political association, or for any political purpose, the officers in default and any member who voted for the breach shall be jointly and severally liable to refund to the company the sum or value of the donation or gift and in addition, every such officer or member commits an offense and is liable to a fine equal to the amount or value of the donation or gift.

Effects of Ultra Vires Acts

– A company shall not, carry on any business expressly prohibited by its memorandum and shall not exceed the powers conferred upon it by its memorandum or this Act.

-A breach of the above-mentioned provision, may be asserted in any proceeding under the relevant provisions of this Act .

-Notwithstanding the provisions of the act, no act of a company, conveyance or transfer of property to or by a company shall be invalid by reason of the fact that such act, conveyance or transfer was not done or made for the furtherance of any of the authorized business of the company or that the company was otherwise exceeding its objects or powers.

– On the application of:

(a) any member of the company, or

(b) the holder of any debenture secured by a floating charge over all or any of the company’s property or by the trustee of the holders of any such debentures, the Court may prohibit, by injunction, the doing of, any act,conveyance or transfer of any property in breach of the relevant provisions of the act.

– If the transactions sought to be prohibited in any proceeding under this act are being, or are to be performed or made pursuant to any contract to which the company is a party, the Court may, if it deems the same to be equitable and if all the parties to the contract are parties to the proceedings,set aside and prohibit the performance of such contract, and may allow compensation to the company or to the other parties to the contract for any loss or damage sustained by them by reason of the setting aside or prohibition of the performance of such contract but no compensation shall be allowed for loss of anticipated profits to be derived from the performance of such contract.

The Effect of Reliance on Restrictions in the Memorandum

The act provides here that :-

– Where there is provision in the memorandum of association of a company restricting the powers and capacity of the company to carry on its authorised business or object, the restriction may be relied on and have effect only for the purpose of proceedings-

(a) against the company by a director or member of the company, or where the company has issued debentures secured by a floating charge over all or any of the company’s property, by the holder of any of the debentures or the trustee for the holders of the debentures ;

(b) by the company or a member of the company against the present or former officers of the company for failure to observe any such restriction ;

(c) by the Commission or a member of the company to wind up the company ; or

(d) for the purpose of restraining the company or other person from acting in breach of the memorandum or directing the company or such person to comply with the same.

– A person may not in the proceedings referred to in the relevant provisions of this act, rely on a restriction of the power or capacity of the company contained in the memorandum in any case where he voted in favour of, or by conduct agreed to the doing of an act by the company or the conveyance by or to the company of property which, it is alleged in the proceedings, was or would be contrary to the restriction.

Legal Effects of Memoranda & Articles

– Subject to the provisions of this Act, the memorandum and articles, when registered, shall have the effect of a deed between the company and its members and officers and between the members and officers themselves whereby they agree to observe and perform the provisions of the memorandum and articles, as altered in so far as they relate to the company,its members, or officers.

– All money payable by any member to the company under the memorandum or articles shall be a debt due from him to the company and shall be of the nature of a specialty debt.

– Where the memorandum or articles empower any person to appoint or remove any director or other officer of the company, such power shall be enforceable by that person notwithstanding that he is not a member or officer of the company.

– In any action by any member or officer to enforce any obligation owed under the memorandum or articles to him and any other member or officer, such member or officer may, if any other member or officer is affected by the alleged breach of such obligation, with his consent, sue in a representative capacity on behalf of himself and all other members or officers who may be affected other than any who is a defendant and the provisions of this Act shall apply.

Restrictions on Alteration of Memorandum

– The act provides that a company may not alter the conditions contained in its memorandum except in the cases and in the manner and to the extent for which express provision is made in this Act.

– Only those provisions which are required by any specific provision contained in this Act, to be stated in the memorandum of the company concerned, are deemed to be conditions contained in its memorandum.

Alteration of Memorandum

– Under CAMA 2020, the name of the company shall not be altered except with the consent of the Commission in certain circumstances.

– The business which the company is authorised to carry on or, if the company is not formed for the purpose of carrying on business, the objects for which it is established, may be altered or added to in accordance with the provisions of the act.

– Any restriction on the powers of the company may be altered in the same way as the business or objects of the company.

– The share capital of the company may be altered in accordance with the provisions of CAMA 2020, but not otherwise.

– Under CAMA 2020, any other provision of the memorandum maybe altered in accordance with outlined conditions and procedures , or as otherwise provided in this Act.

Binance to stop accepting new UK Users; Understand Synthetic Stablecoins in DeFi

By
Paul Ugbede Godwin
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0

Binance, one of the world’s largest cryptocurrency exchanges, has announced that it will stop accepting new users from the UK. This decision comes after the Financial Conduct Authority (FCA) issued a consumer warning against the platform, stating that it is not authorized to operate in the country.

Binance said in a statement that it is “disappointed” by the FCA’s action, and that it is committed to working with regulators to create a sustainable and healthy industry. Binance added that it will continue to provide services to existing UK customers, and that they can still access their funds and trade on its website and app.

The FCA’s warning is part of a global crackdown on the crypto sector, as regulators seek to protect investors from the risks and volatility of digital assets. The FCA has also banned the sale of crypto derivatives to retail consumers and warned that crypto investments are not covered by any compensation schemes or ombudsman services.

Binance is not the only crypto exchange facing regulatory hurdles in the UK. In June, Japan’s Financial Services Agency (FSA) issued a similar warning against Binance, saying that it is operating without registration. Binance has also faced challenges in Germany, Thailand, Canada, and the US.

Despite these difficulties, Binance remains one of the most popular and influential platforms in the crypto space, with over 13 million users and a daily trading volume of over $20 billion. Binance offers a wide range of products and services, including spot and futures trading, margin trading, staking, lending, mining, and its own blockchain and token, Binance Coin (BNB).

However, the FCA’s warning is not the only reason why Binance decided to stop accepting new UK users. Binance is facing a global crackdown on the crypto sector, as regulators seek to protect investors from the risks and volatility of digital assets. The FCA has also banned the sale of crypto derivatives to retail consumers and warned that crypto investments are not covered by any compensation schemes or ombudsman services.

Binance’s CEO, Changpeng Zhao, also known as CZ, has said that he welcomes regulation as a way to foster innovation and growth. He has also expressed his willingness to cooperate with authorities and comply with local laws. CZ has said that he does not have a permanent headquarters or residence, and that he operates Binance as a decentralized organization.

Binance’s move to stop accepting new UK users may have a significant impact on the crypto market in the country, as well as on the broader adoption and acceptance of digital currencies. However, it may also create opportunities for other platforms and players to fill the gap and offer alternative solutions. The crypto industry is constantly evolving and adapting to changing circumstances, and Binance’s case is just one example of how regulation can shape its future.

TrueUSD third-party security breach revealed Blockchain Wallet addresses of clients.

TrueUSD, a stablecoin backed by the US dollar, has disclosed a security breach that exposed the blockchain wallet addresses of some of its clients. The incident occurred on October 15, when an unauthorized third-party accessed a database containing sensitive information related to the verification process of TrueUSD users.

According to a blog post by TrustToken, the company behind TrueUSD, the breach was detected and contained within 15 minutes, and no funds were lost or stolen. However, the attacker was able to view and copy some data, including the names, email addresses, and blockchain wallet addresses of some users who had completed the identity verification process.

TrustToken said that it has notified the affected users and advised them to change their passwords and enable two-factor authentication on their accounts. The company also said that it has launched an investigation into the incident and is working with law enforcement and cybersecurity experts to prevent future attacks.

The security breach is a serious blow to the reputation of TrueUSD, which claims to be one of the most transparent and trustworthy stablecoins in the market. TrueUSD is backed by US dollars held in escrow accounts and verified by independent third-party auditors. The stablecoin is designed to provide a stable and reliable alternative to volatile cryptocurrencies, and is widely used by traders, investors, and businesses.

TrustToken said that it is committed to protecting the privacy and security of its users, and that it will take all necessary steps to restore their trust. The company also said that it will offer a reward of up to $100,000 for any information that leads to the arrest and conviction of the attacker.

Trade-offs involved in creating and using synthetic stablecoins in DeFi

Meanwhile, Synthetic stablecoins are digital assets that aim to maintain a stable value relative to a reference asset, such as a fiat currency or a commodity. They are created and used in decentralized finance (DeFi) platforms, which are blockchain-based applications that enable various financial services without intermediaries.

Synthetic stablecoins have some advantages over traditional stablecoins, such as greater scalability, lower fees, and more flexibility. However, they also entail significant trade-offs and risks that users and developers should be aware of.

One of the main trade-offs of synthetic stablecoins is the need for overcollateralization. This means that users have to lock up more value in collateral than the value of the synthetic stablecoins they create or borrow. For example, if a user wants to create $100 worth of synthetic USD, they may have to deposit $150 worth of ETH as collateral.

This ensures that the synthetic stablecoins are always backed by sufficient assets in case of market fluctuations or liquidations. However, this also reduces the capital efficiency and liquidity of the users, as they have to lock up more funds than they actually need.

Another trade-off of synthetic stablecoins is the complexity and uncertainty of their design and governance. Unlike traditional stablecoins, which are usually backed by centralized entities that guarantee their redemption and regulation, synthetic stablecoins are governed by decentralized protocols that rely on algorithms, incentives, and community votes.

This makes them more transparent and democratic, but also more prone to errors, bugs, attacks, and disputes. For example, if a synthetic stablecoin protocol suffers a security breach or a governance failure, it may lose its peg or its functionality, resulting in losses for the users.

A third trade-off of synthetic stablecoins is the exposure to systemic and idiosyncratic risks in the DeFi ecosystem. Synthetic stablecoins are interconnected with other DeFi protocols and services, such as lending, borrowing, trading, and derivatives. This creates a network effect that enhances the utility and innovation of DeFi, but also amplifies the potential impact of any shock or disruption.

For example, if a major DeFi protocol experiences a liquidity crisis or a technical malfunction, it may trigger a cascade of liquidations and defaults across the DeFi ecosystem, affecting the stability and solvency of synthetic stablecoins.

Synthetic stablecoins are an emerging and promising form of digital money that offer new possibilities and opportunities for DeFi users and developers. However, they also involve significant trade-offs and risks that require careful evaluation and management.

Users should understand the mechanics and assumptions behind each synthetic stablecoin protocol, as well as the potential scenarios and outcomes of their actions. Developers should strive to design and implement robust and resilient synthetic stablecoin protocols that can withstand various shocks and stresses in the DeFi ecosystem.

BlackRock says Spot Bitcoin ETF application still under review by SEC

By
Paul Ugbede Godwin
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0

The world’s largest asset manager, BlackRock, has confirmed that its application for a spot Bitcoin ETF is still pending approval from the US Securities and Exchange Commission (SEC). The company filed the application in July, seeking to offer investors exposure to the actual Bitcoin cryptocurrency, rather than futures contracts or other derivatives.

This statement from BlackRock is in regard to the recent article published by Cointelegraph which claimed that the U.S. Securities and Exchange Commission (SEC) had approved the first Bitcoin Spot ETF, issued by iShares. The article, which was quickly deleted, sparked a wave of excitement and confusion among cryptocurrency investors, who rushed to buy Bitcoin in anticipation of a price surge.

However, the article turned out to be fake news, as the SEC has not made any official announcement regarding the approval of any Bitcoin ETF. The false report caused many users to FOMO (fear of missing out) and lose money, as they bought Bitcoin at a high price and then saw it drop shortly after. This incident highlights the importance of verifying the sources and credibility of any news related to cryptocurrency regulation, as well as the risks of acting on emotions rather than rational analysis.

A spot Bitcoin ETF would allow investors to buy and sell shares of a fund that holds Bitcoin as its underlying asset, without having to deal with the technical and security challenges of owning and storing the digital currency directly. This would potentially lower the barriers to entry and increase the liquidity and transparency of the Bitcoin market.

However, the SEC has been reluctant to approve any Bitcoin ETFs, citing concerns over market manipulation, fraud, custody, and investor protection. The regulator has repeatedly delayed or rejected applications from various firms, including VanEck, Valkyrie, and Wisdom Tree. The SEC has also indicated that it prefers Bitcoin futures ETFs over spot ones, as futures are regulated by the Commodity Futures Trading Commission (CFTC) and trade on established exchanges.

BlackRock’s application for a spot Bitcoin ETF is one of the few remaining ones that have not been withdrawn or denied by the SEC. The company’s CEO, Larry Fink, has expressed optimism about the prospects of a Bitcoin ETF, saying that he believes there is a “huge appetite” for crypto among investors. He also said that BlackRock is “very excited” about the potential of blockchain technology and digital assets.

BlackRock is not new to the crypto space, as it already offers some exposure to Bitcoin through its Global Allocation Fund and Digital Assets Fund. The company also holds a stake in MicroStrategy, a business intelligence firm that has become one of the largest corporate holders of Bitcoin. Additionally, BlackRock has hired several experts in crypto and blockchain, such as Rick Rieder, its chief investment officer of global fixed income, and Michael Saylor, its head of digital assets.

According to data from Bybt, more than $50 million worth of Bitcoin short positions were liquidated in less than an hour, as the leading cryptocurrency surged. A spot ETF would also increase the demand and liquidity for Bitcoin, as more institutional and retail investors would have access to the market. A spot ETF would also reduce the premium or discount that often occurs on existing Bitcoin products, such as the Grayscale Bitcoin Trust (GBTC) or the Bitcoin futures contracts.

However, the tweet was based on a misunderstanding of a press release by BlackRock, which announced that it had launched two new funds that would invest in Bitcoin futures, not spot. BlackRock already had exposure to Bitcoin futures through its existing funds, and the new funds were not ETFs, but mutual funds.

The SEC has not approved any spot ETF for Bitcoin or any other cryptocurrency, and has repeatedly expressed its concerns about the market manipulation, fraud, and volatility in the crypto space. The SEC has also delayed its decision on several pending applications for Bitcoin futures ETFs, which are considered more likely to be approved than spot ETFs.

Despite the clarification that the rumor was false, the Bitcoin price did not drop back to its previous levels, but rather consolidated around $27,000/28k. This suggests that the market was already bullish on Bitcoin, and that the rumor was just a catalyst for a breakout.

Some analysts also pointed out that the liquidation of short positions added fuel to the rally, as traders who bet against Bitcoin had to buy back their positions at higher prices to cover their losses. This created a positive feedback loop that pushed the price higher.

The false rumor about BlackRock’s spot ETF approval shows how sensitive and reactive the Bitcoin market is to any news or speculation about institutional adoption and regulation. While a spot ETF would be a major milestone for Bitcoin, it is not a necessary condition for its growth and development.

Bitcoin has already shown its resilience and innovation in the face of regulatory uncertainty and hostility and has attracted many prominent investors and corporations to its network. Bitcoin also has a strong community and culture that supports its vision and values, regardless of external factors.

While BlackRock awaits the SEC’s decision on its spot Bitcoin ETF application, several Bitcoin futures ETFs have already launched in the US market, attracting billions of dollars in inflows. These include the ProShares Bitcoin Strategy ETF (BITO), the Valkyrie Bitcoin Strategy ETF (BTF), and the VanEck Bitcoin Strategy ETF (XBTF). However, some analysts have warned that these products may not accurately reflect the price of Bitcoin, as they are subject to contango and roll costs.

A spot Bitcoin ETF would be a more direct and efficient way to invest in Bitcoin, as it would track the actual price of the cryptocurrency and eliminate the need for intermediaries. However, it remains unclear whether the SEC will ever approve such a product, or what conditions it would impose on it. BlackRock’s application is still under review by the regulator, and no timeline has been given for its approval or rejection.

EU regulator warns of DeFi risks; Upbit obtains initial approval for Digital Asset License in Singapore

By
Paul Ugbede Godwin
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0

Have you heard the latest news from the EU? Apparently, they are not so keen on the idea of decentralized finance (DeFi) and its implications for the financial system. In a recent report, the European Securities and Markets Authority (ESMA) warned of the risks and challenges posed by DeFi, especially when it comes to consumer protection, market integrity and financial stability.

One of the main issues that the ESMA raised was the concept of ‘code as law’, which means that the rules and outcomes of DeFi applications are determined by the underlying smart contracts, rather than by human intervention or oversight.

The ESMA argued that this approach could lead to legal uncertainty, operational failures, cyberattacks, fraud and manipulation. They also questioned whether DeFi users are fully aware of the risks and responsibilities involved in using such platforms, and whether they have adequate recourse in case of disputes or losses.

The ESMA also suggested that some DeFi activities may fall under the existing EU regulatory framework, depending on their features and functions. For example, some DeFi tokens may qualify as financial instruments or electronic money, and some DeFi platforms may provide investment services or payment services. Therefore, the ESMA urged DeFi providers to comply with the relevant rules and regulations, and to cooperate with the authorities and supervisors.

This report is not surprising, given that the EU has been taking a cautious and conservative stance on crypto-related matters. However, it also shows that the EU is paying attention to the developments and innovations in the DeFi space, and that it is trying to balance the potential benefits and risks of this emerging sector.

The ESMA acknowledged that DeFi could offer more efficiency, transparency, competition and financial inclusion, but also stressed the need for a level playing field and a sound governance framework.

Coinbase; The approval of a bitcoin spot ETF is partially priced in.

The cryptocurrency market has been anticipating the launch of a bitcoin spot exchange-traded fund (ETF) in the US for a long time. Many experts believe that such a product would boost the adoption and legitimacy of bitcoin as an asset class, as well as attract more institutional and retail investors to the space.

However, the US Securities and Exchange Commission (SEC) has been reluctant to approve any bitcoin spot ETF proposals, citing concerns over market manipulation, investor protection, and regulatory oversight. The SEC has only approved bitcoin futures ETFs so far, which track the price of bitcoin futures contracts rather than the underlying asset itself.

Coinbase, one of the largest and most influential cryptocurrency platforms in the world, has recently shared its view on the prospects of a bitcoin spot ETF in the US. In its Q3 2021 shareholder letter, Coinbase stated that it expects a bitcoin spot ETF to be approved in the US “in the next few years”, but also noted that some of the potential impact of such an approval is already reflected in the current market prices.

“We believe that a bitcoin spot ETF approval in the US is partially priced in, given that several bitcoin futures ETFs have already launched and are trading at a premium to NAV [net asset value],” Coinbase wrote. “We also believe that there is still significant upside potential for a bitcoin spot ETF approval, as it would likely increase retail demand and lower the barriers to entry for many investors who are interested in gaining exposure to bitcoin.”

Coinbase added that it is actively engaging with regulators and policymakers to advocate for a clear and consistent regulatory framework for cryptocurrencies, including a bitcoin spot ETF. The company said that it believes that such a framework would benefit not only Coinbase, but also the entire industry and its customers.

“We continue to work closely with regulators and policymakers to educate them on our industry and our products, and to provide feedback on proposed rules and guidance,” Coinbase wrote. “We believe that constructive dialogue and collaboration are essential to foster innovation and growth in the crypto economy, while also protecting investors and consumers.”

Upbit obtains initial approval for Digital Asset License in Singapore

Upbit, one of the largest cryptocurrency exchanges in South Korea, has announced that it has received a provisional license from the Monetary Authority of Singapore (MAS) to operate as a digital asset service provider in the city-state. This is a significant milestone for Upbit, as it aims to expand its global presence and offer its services to more customers in the rapidly growing Asian market.

According to a press release, Upbit applied for the license under the Payment Services Act (PSA), which regulates the activities of digital payment token (DPT) service providers in Singapore. The PSA requires DPT service providers to comply with various rules and standards, such as anti-money laundering, counter-terrorism financing, cybersecurity, and consumer protection. Upbit said that it has met all the requirements and demonstrated its commitment to operating in a safe and responsible manner.

Upbit is the first major Korean exchange to obtain the license from MAS, which is widely regarded as one of the most progressive and forward-looking regulators in the world. Upbit said that it will leverage its experience and expertise in the Korean market to provide high-quality services to its Singaporean customers, as well as to contribute to the development of the local blockchain ecosystem.

Upbit also said that it plans to launch its Singaporean platform in the first quarter of 2024, after completing the necessary preparations and obtaining the final approval from MAS. The platform will offer a variety of features and functions, such as spot trading, margin trading, staking, lending, and derivatives. Upbit said that it will support multiple fiat currencies, including Singapore dollar, US dollar, and Korean won, as well as over 200 cryptocurrencies.

Upbit’s CEO Lee Seok-woo expressed his gratitude and excitement for receiving the provisional license from MAS. He said: “We are honored and delighted to be recognized by MAS as a trustworthy and reliable digital asset service provider. This is a testament to our efforts and achievements in the Korean market, where we have established ourselves as a leading exchange with a strong reputation and customer base. We look forward to bringing our expertise and innovation to Singapore and serving our customers with the best products and services possible.”

Social finance apps Tomo and New Bitcoin City break above $1 million in TVL

In a remarkable feat of innovation and adoption, two social finance apps have surpassed the $1 million mark in total value locked (TVL) within a week of their launch. Tomo and New Bitcoin City are both decentralized applications (dApps) that leverage blockchain technology to create peer-to-peer lending and borrowing platforms with social features.

Tomo is a dApp that allows users to lend and borrow cryptocurrencies with their friends, family, and trusted contacts. Users can create personalized loan agreements, set interest rates and repayment terms, and chat with their lenders or borrowers within the app.

Tomo also rewards users for timely repayments and referrals with its native token, TOMO, which can be staked to earn passive income or used to access premium features.

New Bitcoin City is a dApp that enables users to create and join virtual communities based on their interests, hobbies, or goals. Users can pool their funds together to invest in various DeFi protocols, such as yield farming, liquidity mining, or NFTs, and share the profits among the members. New Bitcoin City also has a gamified interface that allows users to customize their avatars, explore the city, and interact with other residents.

Both Tomo and New Bitcoin City have attracted a lot of attention and capital from the crypto community, as they offer novel ways to engage with DeFi and socialize with like-minded people. According to DeFi Pulse, Tomo has reached a TVL of $1.2 million, while New Bitcoin City has achieved a TVL of $1.1 million as of October 16, 2023. These numbers are expected to grow as more users discover and join these innovative platforms.

The success of Tomo and New Bitcoin City demonstrates the potential of social finance as a new paradigm for DeFi. By combining financial services with social interactions, these dApps create more value and utility for their users, as well as foster a sense of community and trust among them. Social finance is not only a trend, but a movement that could redefine the future of finance.

FEC Approves Nigeria’s $1.5bn and $80m Loan Requests from World Bank, AfDB

By
Samuel Nwite
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0

Wale Edun, the Minister of Finance and Coordinating Minister of the Economy, has disclosed that the Federal Executive Council (FEC) has given its approval for a $1.58 billion loan request, one day after he confirmed that the federal government was in the process of securing the loan.

The minister explained that the approved loan request consists of two components: $1.5 billion from the World Bank and $80 million from the African Development Bank (AfDB).

He further elaborated that the $1.5 billion from the World Bank will be channeled through the International Development Association (IDA), a branch of the World Bank that extends interest-free loans to low-income nations.

“We also approved today the application for financing from the World Bank. And in particular, the International Development Association which is really the virtually free or zero interest lending arm or financing arm of the World Bank,” he said.

“The total is $1.5 billion. And the background is just as you heard from the Minister of Planning and Budget.”

Edun on Saturday assured that the loan would come with a near-zero interest rate, alleviating concerns about escalating Nigeria’s debt service commitments. He clarified that there would be no negative connotations associated with obtaining World Bank funding to support developmental projects.

Edun noted that the loan request is significant as it arrives at a time when borrowing costs are increasing, primarily due to developed nations hiking interest rates and implementing tighter monetary policies to combat inflation.

“What that means is that interest rates for everybody else, become not just high but very painful, if not on (sic) affordable within that context,” he said.

Edun said the World Bank is willing to lend to Nigeria because of some tough policies made by President Bola Tinubu. This loan is expected to support Nigeria in managing its finances, especially the nearly $7 billion backlog in FX obligations.

He emphasized that the firm measures taken by the government have garnered the backing of multilateral development institutions. Consequently, the World Bank is poised to facilitate $1.5 billion in concessional financing on Nigeria’s behalf. This funding will be both relatively affordable and swiftly disbursed.

Regarding the $80 million loan from the African Development Bank (AfDB), Edun disclosed that it will be allocated for the Ekiti Knowledge Zone (EKZ) project. This initiative aims to equip the youth in Ekiti with crucial technological skills, particularly given the increasing contribution of the technology sector to the nation’s economy.

However, increasing borrowing amid unsustainable public debt stock and dwindling revenue remains a huge concern for Nigerians, especially as the government is believed to be borrowing for consumption. Nigeria is said to be spending more than 90 percent of its revenue on debt servicing currently.

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