Nigeria Embraces Virtual Assets with Regulatory Framework

President Bola Tinubu has signed an executive order establishing a comprehensive regulatory framework for virtual assets in Nigeria, signaling a major policy shift towards responsible innovation in the digital economy. The immediate-effect order aims to harmonize regulations across financial agencies, protect consumers from fraud, and ensure the integrity of the financial system while enabling growth in the virtual asset sector.

The new framework establishes a Virtual Asset Council chaired by the Central Bank of Nigeria (CBN), including representatives from the Federal Inland Revenue Service (FIRS), Securities Exchange Commission (SEC), Nigerian Financial Intelligence Unit (NFIU), and Office of the National Security Advisor. This council will develop policies that align with national security, economic objectives, and social priorities.

Key components of the regulatory framework include:

• CBN Sandbox: A controlled environment for virtual asset operators to test products under regulatory supervision
• Tax Policy: Dedicated policy development by tax authorities for the virtual assets sector
• White Paper: Finalization of a comprehensive document outlining Nigeria’s long-term vision for virtual assets

The move is particularly significant for stablecoins, which have gained popularity in Nigeria but also faced regulatory uncertainty. Experts note that clear regulations requiring credible reserves and consumer protections could foster trust and institutional participation.

Nigeria’s stance on cryptocurrencies has evolved from earlier restrictions to greater openness as digital asset usage expanded—approximately 40% of Nigerians now use crypto for international money transfers, far exceeding the global average.

“This is a potentially significant shift,” said Lagos-based technology attorney Rotimi Ogunyemi. “The true measure will be whether this framework makes it easier for responsible companies to operate and serve customers safely within clear regulatory guidelines.” The government’s recognition of crypto adoption suggests a move towards regulation rather than prohibition, aiming to harness the benefits while mitigating risks in Nigeria’s evolving digital economy.