Nigeria’s Securities and Exchange Commission (SEC) has issued new regulatory guidelines requiring cryptocurrency platforms to register with the agency and share transaction data, even if they operate from outside the country.
The rules, published on Wednesday, apply to any digital asset service provider that targets Nigerian users, marking a significant expansion of the regulator’s reach into the cryptocurrency sector.
Registration and data sharing requirements
Under the new framework, crypto exchanges, wallet providers, and other virtual asset service providers must apply for registration with the SEC if they serve Nigerian customers. This includes platforms that do not have a physical presence in Nigeria but make their services available to Nigerian users through websites, mobile apps, or marketing channels.
Registered firms will be required to share transaction data with the SEC, though the commission has not yet published detailed guidelines on the scope, frequency, or format of the data that must be submitted. The rules also mandate that platforms comply with Nigeria’s anti-money laundering and counter-terrorism financing regulations.
The SEC said the measures are designed to protect investors and ensure transparency in the digital asset market. The commission has been developing its cryptocurrency regulatory framework since 2020, when it first recognised digital assets as securities.
The registration requirement creates a new compliance burden for international cryptocurrency platforms that have previously operated in Nigeria without direct regulatory oversight. Major exchanges including Binance, Coinbase, and KuCoin serve Nigerian users, though several platforms have restricted services to the country in recent years due to regulatory uncertainty.
Binance, the world’s largest cryptocurrency exchange by trading volume, blocked Nigerian naira deposits and withdrawals in March 2024 following a dispute with Nigerian authorities over the platform’s role in exchange rate volatility. The company has not yet resumed full services in the country.
The new SEC rules do not specify penalties for non-compliance, but the commission has the authority to block access to unregistered platforms and pursue enforcement action against companies operating without authorisation.
Nigeria has taken a mixed approach to cryptocurrency regulation. The Central Bank of Nigeria banned banks from servicing crypto businesses in February 2021, a restriction that remains in place. However, the SEC has moved to establish a licensing framework for digital assets, arguing that regulatory clarity is necessary to protect investors and support innovation.
The country has one of the highest rates of cryptocurrency adoption in the world. A 2023 survey by Chainalysis ranked Nigeria sixth globally for grassroots crypto adoption, driven by demand for remittances, inflation hedging, and cross-border payments.
The SEC’s new registration requirement follows similar moves by regulators in South Africa, Kenya, and Ghana, where authorities have introduced licensing regimes for cryptocurrency platforms in recent years. The African Union is also developing a continent-wide framework for digital asset regulation, though implementation remains at an early stage.
The commission has not announced a deadline for existing platforms to submit registration applications.