Nigeria’s Securities and Exchange Commission (SEC) plans to fast-track the issuance of cryptocurrency licences in 2025 as part of its regulatory efforts to protect consumers. The regulator aims to expedite approvals to provide clarity in a largely unregulated market.
Since launching the Accelerated Regulatory Incubation Programme (ARIP) in June 2024, the SEC has granted provisional licences to two Nigerian crypto startups, Quidax and Busha. The commission has indicated plans to issue more provisional licences in the coming year.
Nigeria remains an active crypto market, with individuals and businesses using digital assets to hedge against inflation and exchange rate volatility. However, the absence of clear regulatory guidelines has created uncertainty for investors and users. A report from Busha found that nearly half of 1,500 Nigerian respondents cited security concerns as a major barrier to cryptocurrency adoption. Centralized exchanges and peer-to-peer (P2P) transactions pose risks, especially for new users unfamiliar with blockchain operations and transaction fees.
Fraudulent schemes, particularly “rug-pull” scams, continue to threaten the sector, with scammers inflating token values before cashing out and leaving investors with losses. Crypto traders argue that education alone is insufficient to combat these risks, stressing the need for stronger regulatory intervention.
Industry experts emphasize that consumer protection must be a priority, with the SEC’s recent initiatives seen as a step in the right direction. The commission has gradually developed its crypto framework since 2020, issuing guidelines and requiring virtual asset service providers to register.
The SEC’s ARIP initiative marks a departure from Nigeria’s previous anti-crypto stance. The Central Bank of Nigeria (CBN) lifted its ban on banks engaging with crypto firms in December 2023, allowing startups to regain access to banking services.
Despite this, some banks remain hesitant due to regulatory uncertainties. Crypto startups, including Quidax, Busha, Yellow Card, and Bitnob, have applied for provisional licences under ARIP, undergoing a rigorous evaluation process that scrutinizes their compliance and consumer protection measures.
Industry stakeholders see the ARIP as one of the boldest regulatory moves in Africa, but questions remain about how the SEC will maintain a balance between fostering innovation and ensuring compliance.