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The Roles of Solicitors as Operators in the Nigerian Capital Market

By
Emmanuel Ifeanyi Ogbuka
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0

Capital Market Operators (CMOs) are intermediaries who facilitate the mechanism of mobilizing funds for long term investment. They transact various businesses in the stock market and cannot operate in the capacity of operators unless they have been duly compulsorily registered with the Securities and Exchange Commission (SEC). 

The relevant provisions of the Investment & Securities Act (ISA) as well as the SEC Rules mention legal practitioners/solicitors as one of the classes of professionals subject to registration with the SEC in so far as their professional opinions impact directly on capital market transactions.

This article will be looking at the various roles of solicitors within the Capital Market .

What is the general duty of a solicitor in the Nigerian Capital Market?

It is the duty of the solicitor to ensure that there is no deliberate concealment of material facts or misstatements in offer documents relating to a capital market transaction for which otherwise the solicitor would be liable as a result of a failure to exercise reasonable professional diligence.

What is the role of a solicitor to an issuing party in a capital market transaction?

– The solicitor ensures that the issuer is in good legal and regulatory stand with regards to the issue.

– The solicitor ensures that the company’s memorandum and articles of association as well as its certificate of incorporation reflect the status of the issuer as a public company.

– The solicitor drafts the underwriting and other agreements.

– The solicitor ensures that contracts (if any) in which any director has an interest are disclosed ,e.g. contracts of service of long durations as well as contracts involving substantial properties belonging to the company.

– The solicitor must ensure that a power of attorney and/or consent documents are duly executed by the chairman and all other directors.

– He must, in conjunction with the company secretary, verify all historical and present facts about the company, with the aim of, ensuring that decisions and minutes of the board and general meeting for the various corporate decisions and approvals are in place.

– The solicitor ensures that the issuer company as well as its principal officers are in good legal standing .

– The solicitor must confirm to the issuing house that the issuer has been properly advised by him and that the directors have collectively and individually accepted full responsibility for the accuracy of the information given in the prospectus and the application forms. He must avoid contravention or breaches of the practice and procedures of Securities and Exchange Commission,the  Corporate Affairs Commission (CAC) &  the Nigerian Stock Exchange especially their listing requirements. 

What is the role of solicitors to the offer?

– Acting as independent professional observers acting on behalf of the general investing public and the issuing house.

– Requesting from the company all substantial contracts and critically examining and determining material contracts for disclosure.

– Verifying the accuracy and authenticity of the company and offer documentation asvwell ascertaining that the condition precedents contained therein have been satisfied.

– Reviewing pending claims and litigations of the issuer and rendering  professional opinions on the likely effect of litigations on the issues.

– Working in conjunction with solicitors to the issuers by examining all documents, contracts and correspondences made available to him and advising the issuing house accordingly on the same.

What is the role of solicitors to the trustee?

Corporate trustees are entities licensed by the SEC to engage in the business of preserving assets such as debentures & bond/security issues handed over to them via the legal instrumentality of a trust deed.

The roles of solicitors to trustees in capital market operations include :-

– Rendering legal advice to the trustees and advising them in selecting viable investments.

– Ensuring that the trustees comply with the laws, regulations and guidelines of the ISA and other laws regarding trustee investments in Nigeria.

– Drafting the trust deed and rendering professional advice to the trustees on all aspects of the trust deed.

Sui, Bitcoin ETF, FTX, Stars Arena, and other Crypto News

By
Paul Ugbede Godwin
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The Sui Foundation, a nonprofit organization dedicated to promoting creativity and innovation, has announced a new initiative called Play Beyond Games. The initiative aims to explore the potential of interactive media beyond entertainment and education, and to foster new forms of expression, collaboration and social impact. Play Beyond Games will support projects that use game design principles and technologies to address real-world challenges, such as climate change, mental health, civic engagement and more.

The initiative will also provide opportunities for learning, networking and mentoring for aspiring creators and changemakers. The Sui Foundation believes that play is a powerful tool for positive change, and that games can be more than just fun. By supporting Play Beyond Games, the foundation hopes to inspire a new generation of creative thinkers and doers who can use interactive media to make a difference in the world.

The U.S. Securities and Exchange Commission (SEC) is expected to give the green light to multiple bitcoin exchange-traded funds (ETFs) that track the spot price of the cryptocurrency, according to a BlackRock executive. Rick Rieder, who is now the chief investment officer of global fixed income at BlackRock, said in an interview with CNBC that he believes the SEC will approve several bitcoin ETFs at the same time, rather than picking one or two winners. He said this would create a more competitive and efficient market for investors who want exposure to bitcoin without buying it directly.

A major security breach occurred at Stars Arena, a popular play-to-earn game on the Avalanche blockchain, resulting in the theft of $2.9 million worth of AVAX tokens from the game’s treasury. The attackers exploited a vulnerability in the smart contract that allowed them to withdraw funds without authorization. However, the developers assured that the funds in user wallets were not affected and that they are working on a compensation plan for the affected players. They also said that they have fixed the bug and are taking measures to prevent future attacks.

The latest book by Michael Lewis, the bestselling author of The Big Short and Moneyball, is a scathing expose of the SBF, or the Strategic Brainstorming Force, a secretive group of government officials and consultants who devise and implement risky and controversial policies without proper oversight or accountability. Lewis reveals how the SBF has been behind some of the most disastrous decisions in recent history, such as the botched response to the Covid-19 pandemic, the withdrawal from Afghanistan, and the failed attempt to overthrow the Venezuelan regime.

Lewis also interviews some of the former members of the SBF, who share their stories of how they were recruited, manipulated, and silenced by the powerful and charismatic leader of the group, known only as “The Brain”. The book is a shocking and eye-opening account of how a small clique of unelected and unaccountable experts can shape the fate of millions of people with their hairbrained schemes.

A surprising discovery was made by a former executive of FTX, a leading cryptocurrency exchange platform. The executive, who wished to remain anonymous, revealed that he once stumbled upon several airdrops of tokens worth millions of dollars that the company had received without being aware of them. Airdrops are a way of distributing new tokens to existing holders of a certain cryptocurrency, usually as a marketing strategy or an incentive.

The executive said that he found the airdrops while auditing the company’s wallets and was shocked by the amount of money that was sitting there unnoticed. He added that he informed the CEO of FTX, Sam Bankman-Fried, who decided to donate most of the airdrops to charity.

Ostium Labs, a decentralized exchange (DEX) platform, has announced that it has secured $3.5 million in a seed funding round led by Polychain Capital. The startup aims to offer perpetual swap contracts for commodities such as oil and gold, leveraging blockchain technology and smart contracts. Perpetual swaps are a type of derivative that allow traders to speculate on the price movements of an underlying asset without an expiry date. Ostium Labs claims that its platform will provide lower fees, higher liquidity, and more transparency than traditional exchanges, as well as enable cross-chain interoperability and access to global markets.

Future of Finance will be shaped by Interplay between Fintech companies and Banks

By
Paul Ugbede Godwin
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Banks are not sleeping because they are fully aware that the business model of Fintech companies will likely converge towards them. This is the main conclusion of a recent report by the World Economic Forum, which analyzes the impact of digital transformation on the financial sector.

The report argues that Fintech companies, which offer innovative solutions for payments, lending, insurance, wealth management and other services, are not only disrupting the traditional banking industry, but also creating new opportunities for collaboration and integration.

According to the report, Fintech companies have three main advantages over banks: they are more customer-centric, more agile and more data-driven. They can leverage their digital platforms, artificial intelligence and cloud computing to provide personalized, convenient and low-cost services to their users.

They can also adapt quickly to changing customer needs and regulatory environments, as well as experiment with new products and business models. Moreover, they can use their data to generate insights, optimize decisions and create value for their customers and partners.

However, the report also acknowledges that Fintech companies face significant challenges and limitations, such as scaling up their operations, ensuring trust and security, complying with regulations and standards, and competing with other players in the market. These challenges may prevent them from achieving profitability and sustainability in the long term.

Furthermore, the report suggests that Fintech companies will eventually need to offer a broader range of services and products to their customers, which may require them to partner with or acquire other Fintech or non-Fintech firms. This may lead to a convergence of business models between Fintech companies and banks.

The report warns that banks should not underestimate the threat posed by Fintech companies, but rather embrace the opportunities for collaboration and innovation. Banks have several strengths that Fintech companies lack, such as a large customer base, a strong brand reputation, a deep expertise in financial services, a robust infrastructure and a regulatory compliance capability.

One of the key questions that the report addresses is how banks collaborate with Fintech companies to achieve mutual benefits and synergies. The report identifies four main types of collaboration models:

Coopetition: Banks and Fintech companies compete in some areas and cooperate in others, such as sharing data, infrastructure or customers. For example, a bank may use a Fintech company’s payment platform to offer faster and cheaper transactions to its customers, while a Fintech company may use a bank’s deposit network to provide liquidity and security to its users.

Partnership: Banks and Fintech companies form strategic alliances to jointly offer products or services to their customers, leveraging their respective strengths and capabilities. For example, a bank may partner with a Fintech company to provide digital lending or wealth management solutions to its customers, while a Fintech company may partner with a bank to access its regulatory expertise or distribution channels.

Investment: Banks and Fintech companies invest in each other to acquire equity stakes, technologies or talents. For example, a bank may invest in a Fintech company to gain access to its innovative solutions or customer base, while a Fintech company may invest in a bank to enhance its credibility or scalability.

Acquisition: Banks and Fintech companies merge or acquire each other to create new entities that combine the best of both worlds. For example, a bank may acquire a Fintech company to integrate its digital capabilities into its core business, while a Fintech company may acquire a bank to obtain its licenses or assets.

The report suggests that banks should adopt a flexible and proactive approach to collaborate with Fintech companies, depending on their strategic objectives, competitive advantages and market conditions. The report also recommends that banks should foster a culture of innovation and experimentation within their organizations, as well as engage with regulators and policymakers to create an enabling environment for digital finance.

Banks can leverage these strengths to enhance their digital capabilities, improve their customer experience, diversify their revenue streams and reduce their costs. Banks can also partner with or invest in Fintech companies to access new markets, technologies and talents.

The report posited that the future of finance will be shaped by the interplay between Fintech companies and banks, as well as by other factors such as customer preferences, regulatory frameworks and social impacts. The report calls for a constructive dialogue and cooperation among all stakeholders to ensure that the digital transformation of finance benefits everyone.

Block quietly shipping the first editions of its Bitcoin Hardware wallet for Testing

By
Paul Ugbede Godwin
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Block, a company that specializes in developing secure and user-friendly hardware wallets for Bitcoin, has announced that it has started shipping the first batch of its flagship product, the Block Wallet, to a select group of testers. The Block Wallet is a device that allows users to store, send and receive Bitcoin without relying on third-party services or intermediaries. The device is designed to be easy to use, portable and resistant to physical and digital attacks. Jack Dorsey’s new Blockchain enterprise, Block is focused on building products and services that enable people to participate in the Bitcoin ecosystem.

Block has been working on its hardware wallet for a while, but it has kept the details under wraps. However, according to some sources, Block is quietly shipping the first editions of its new Bitcoin hardware wallet to a select group of testers and early adopters. These lucky few will get to try out the device and provide feedback to Block before it launches to the public.

The Block hardware wallet is expected to have some unique features that set it apart from other wallets on the market. For example, it will use a QR code system to communicate with the user’s smartphone, instead of relying on USB or Bluetooth connections. This will make the device more secure and convenient, as well as compatible with any smartphone that has a camera.

Another feature that Block is reportedly working on is a multisig option, which will allow users to require multiple signatures to authorize a transaction. This will add an extra layer of security and prevent unauthorized access to the user’s funds. Multisig is also useful for businesses and organizations that want to share control of their Bitcoin.

“We are excited to announce that we have started shipping the first editions of our Bitcoin Hardware wallet, Block, to a select group of testers. Block is a secure and easy-to-use device that allows you to store, send and receive Bitcoin and other cryptocurrencies.

Block is designed to protect your private keys from hackers, malware and physical damage. It also features a large touchscreen, a fingerprint scanner, a camera and a QR code reader. You can use Block to sign transactions, verify addresses and scan QR codes without connecting to a computer or a smartphone.

We have been working hard to develop Block for the past two years, and we are grateful for the feedback and support we have received from the Bitcoin community. We have chosen a small group of testers who have pre-ordered Block and who have agreed to share their honest opinions and suggestions with us. We will use their feedback to improve Block and make it ready for mass production.’

We believe that Block is the best Bitcoin Hardware wallet on the market, and we can’t wait to share it with you. If you are interested in pre-ordering Block, you can visit our website and join our waiting list. We expect to ship the next batch of Block devices in early 2024.’’

Block has not announced when it will release its hardware wallet to the public, but it is likely that it will happen soon as January, given that it is already shipping the first editions. The device will probably be in high demand, as more and more people are interested in Bitcoin and want a safe and easy way to store and use it.

If you want to learn more about Block and its hardware wallet, you can visit their website or follow them on Twitter. You can also sign up for their newsletter to get updates on their products and services. Block is one of the most exciting companies in the Bitcoin space, and we can’t wait to see what they will do next.

Bitcoin Next Cycle Top at $137,000

By
Paul Ugbede Godwin
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0

Bitcoin has gone through four major cycles since its inception in 2009. Each cycle consists of a bull market, where the price rises exponentially, followed by a bear market, where the price corrects significantly. The duration and magnitude of each cycle vary, but they tend to follow a pattern of increasing length and decreasing volatility.

I will explain why I believe that Bitcoin will reach a new all-time high of $137,000 in the next cycle. I will use historical data, technical analysis and fundamental factors to support my thesis.

The first cycle lasted from 2009 to 2011 and saw Bitcoin rise from $0.01 to $31.91, a 319,000% increase. The second cycle lasted from 2011 to 2013 and saw Bitcoin rise from $2.22 to $1,163.00, a 52,300% increase. The third cycle lasted from 2013 to 2017 and saw Bitcoin rise from $65.53 to $19,891.00, a 30,300% increase. The fourth cycle lasted from 2017 to 2021 and saw Bitcoin rise from $1,017.03 to $69,000.00, a 6,700% increase.

Based on these data, we can observe that each cycle peak is roughly 10 times higher than the previous one, and that each cycle duration is roughly four times longer than the previous one. If we extrapolate this pattern to the next cycle, we can estimate that the peak will be around $690,000 and the duration will be around 16 years.

However, this is a very simplistic and optimistic projection that does not account for the diminishing returns and the increasing challenges that Bitcoin faces as it grows. Therefore, I will use a more conservative and realistic approach to estimate the next cycle top.

Technical analysis is the study of price patterns and trends using various tools and indicators. One of the most popular and reliable tools is the logarithmic regression curve, which plots the price of Bitcoin on a logarithmic scale and fits a curve that best represents its long-term growth trajectory.

The logarithmic regression curve has accurately predicted the previous cycle tops and bottoms with remarkable precision. For example, it predicted the 2013 peak at $1,163, the 2015 bottom at $152, the 2017 peak at $19,891 and the 2019 bottom at $3,122.

Using this tool, we can project the next cycle top by extending the curve to the future and finding the point where it intersects with the price. According to this method, the next cycle top will be around $137,000 and will occur around mid-2024.

This projection is consistent with the historical pattern of decreasing returns and increasing duration of each cycle. It also aligns with other technical indicators such as the stock-to-flow model, which measures the scarcity of Bitcoin by comparing its annual production to its existing supply.

Fundamental factors are the external forces that affect the supply and demand of Bitcoin. They include economic events, regulatory developments, technological innovations and social trends. These factors can have a positive or negative impact on the price of Bitcoin depending on how they influence its adoption, innovation and competition.

Some of the fundamental factors that could drive Bitcoin to $137,000 in the next cycle are:

The adoption of Bitcoin as a legal tender by El Salvador and other countries that face economic instability, hyperinflation or currency devaluation. The integration of Bitcoin into mainstream financial platforms such as PayPal, Square, Visa and Mastercard that enable millions of users to buy, sell and spend Bitcoin easily and securely. The innovation of Bitcoin technologies such as Taproot, Lightning Network and Schnorr Signatures that improve its scalability, privacy and efficiency.

The emergence of Bitcoin ETFs (exchange-traded funds) that allow institutional investors to access Bitcoin exposure without having to deal with custody or regulatory issues. The growth of Bitcoin communities and culture that foster education, awareness and advocacy for Bitcoin as a global digital currency.

In a recent interview, Sam Altman, the founder of ChatGPT, a leading conversational AI platform, shared his views on Bitcoin and its role in the future of humanity. He said, “Bitcoin is a super logical and important step on the technology tree” of humanity, meaning that it is a natural and inevitable outcome of the evolution of technology and society.

Altman explained that Bitcoin is not just a digital currency, but a decentralized network that enables trustless transactions, censorship resistance, and global inclusion. He said that Bitcoin is aligned with the core values of ChatGPT, which are to empower people with natural and engaging communication tools that can enhance their creativity, productivity, and well-being.

He also said that Bitcoin is a catalyst for innovation and social change, as it challenges the status quo and creates new possibilities for economic freedom, financial inclusion, and human rights. He said that ChatGPT is proud to support the Bitcoin community and to contribute to its development and adoption.

Altman concluded by saying that Bitcoin is not only a super logical and important step on the technology tree of humanity, but also a super exciting and inspiring one. He said that he is optimistic about the future of Bitcoin and its impact on the world.

I believe that Bitcoin will reach a new all-time high of $137,000 in the next cycle based on historical data, technical analysis and fundamental factors. This is not a guarantee or a prediction but rather an educated guess based on my own research and analysis. I encourage you to do your own due diligence before investing in Bitcoin or any other asset class.

Bitcoin maintains support level above $27,000 amid BlackRock Launching Tokenized ETF

The cryptocurrency market has been experiencing a lot of volatility in the past few weeks, with Bitcoin dropping below $30,000 several times. However, the leading digital asset has managed to hold above a crucial support level of $27,000, thanks to the buying pressure from long-term holders.

According to data from Glassnode, the number of Bitcoin addresses holding at least 1,000 BTC has increased by 164 since the start of the year, indicating that large investors are accumulating more coins despite the price fluctuations. These long-term holders, also known as “whales”, are considered to have a strong influence on the market sentiment and direction.

Moreover, the amount of Bitcoin held by entities with a low spending history, or “illiquid supply”, has also risen to a new all-time high of 14.5 million BTC, representing 78% of the circulating supply. This means that more Bitcoin is being held for longer periods, reducing the selling pressure and increasing the scarcity of the asset.

These bullish signals suggest that Bitcoin has a strong support base above $27,000, and that long-term holders are confident in its future potential. As long as this level holds, Bitcoin could resume its upward trend and challenge its previous highs of $42,000 and beyond.

Tokenized ETF BlackRock iShares Bond ETF UCITS launched on the Base Network

BlackRock, the world’s largest asset manager, has launched a new exchange-traded fund (ETF) that tracks a basket of bond indices on the Base Network, a decentralized protocol for tokenizing financial assets. The ETF, called iShares Bond ETF UCITS, is the first of its kind to offer exposure to fixed income markets on a blockchain platform.

The iShares Bond ETF UCITS aims to replicate the performance of the Bloomberg Barclays Global Aggregate Bond Index, which covers more than 24,000 bonds from 70 countries and 30 currencies. The index includes government, corporate, and securitized bonds with varying maturities and credit ratings. The ETF has a total expense ratio of 0.1% and is denominated in US dollars.

The Base Network is a protocol that allows anyone to create and trade tokenized versions of any financial asset, such as stocks, bonds, commodities, or currencies. The protocol uses smart contracts to ensure that the tokens are backed by real-world assets and can be redeemed at any time. The Base Network also enables interoperability between different blockchains, allowing users to access a wide range of markets and liquidity pools.

By launching the iShares Bond ETF UCITS on the Base Network, BlackRock aims to provide investors with a low-cost, transparent, and efficient way to access global bond markets. The ETF also offers several advantages over traditional bond funds, such as:

Faster settlement: The ETF tokens can be transferred and settled within minutes on the blockchain, compared to days or weeks for conventional bond trades.

Lower barriers: The ETF tokens can be bought and sold in fractional amounts, allowing investors to participate in bond markets with smaller capital requirements.

Greater accessibility: The ETF tokens can be traded 24/7 on any compatible blockchain platform, expanding the reach and availability of bond markets.

Enhanced security: The ETF tokens are secured by cryptography and distributed ledger technology, reducing the risk of fraud, theft, or manipulation.

The iShares Bond ETF UCITS is the latest example of how BlackRock is embracing innovation and technology to offer better solutions for its clients. The asset manager has been exploring the potential of blockchain and digital assets for several years and has recently expressed interest in launching more crypto-related products in the future. With the iShares Bond ETF UCITS, BlackRock is demonstrating its leadership and vision in the rapidly evolving field of tokenized finance.

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