The scope of the Nigeria Securities and Exchange Commission has expanded to regulate Bitcoin as a "security."

A recent law passed in Nigeria has expanded the authority of the SEC to now include the regulation of Bitcoin (BTC), virtual assets, Crypto Assets, and Tokens as securities.

Nigeria is taking a leading position in the regulation of digital assets in Africa with the recent passage of the Investment and Securities Act (ISA 2025). Emomotimi Agama, the Director of the Nigerian Securities and Exchange Commission, stated that this landmark legislation establishes a solid legal foundation for the thriving digital asset ecosystem and commits to providing transparency, protection, and innovation.

"We expect this to provide a solid legal foundation for the regulation of stablecoins and other digital assets," Agama stated.

At the stablecoin summit held on July 24, the Secretary-General outlined three guiding principles for shaping a "forward-looking approach" in West Africa. These principles include asset backing, interoperability, and market integration, as well as consumer and investor protection.

According to the new framework, all issuers of digital tokens pegged to fiat currencies will be required to maintain verifiable reserves and undergo regular disclosures and independent audits to ensure transparency and stability.

Regulators are also committed to facilitating seamless interaction between digital assets and existing financial infrastructure, particularly in terms of payments and settlements, thereby promoting a more integrated market.

Nigeria SEC Expands Responsibilities and Opens Up New Growth Pathways

Until 2023, Nigeria essentially lacked regulations or laws governing digital assets and did not have a dedicated agency responsible for regulating the cryptocurrency industry. This lack of clarity led existing financial regulatory bodies to be uncertain about which agency has the statutory authority to regulate the industry.

However, ISA 2025 now explicitly incorporates virtual assets, Bitcoin, Crypto Assets, Tokens, and investment contracts into securities law. This grants the Nigerian Securities and Exchange Commission a clear and explicit mandate to regulate the virtual asset market, promote its orderly development, and enhance investor protection.

Currently, two locally established digital asset trading platforms, Busha Digital Limited and Quidax Technologies Limited, have received principal approval from the Nigerian Securities and Exchange Commission, as more companies join the RI program as part of the SEC's strategic phased licensing.

At the same time, Agama revealed the country's position on global digital asset exchanges or virtual asset service providers (VASP) seeking to enter the Nigerian market.

Agama stated: "In the future, foreign VASPs seeking to enter the Nigerian market will be subject to mutual recognition and will sign enforceable memorandums of understanding (MoUs) with their home regulatory agencies to ensure regulatory equivalence and market integrity."

In addition, similar to the measures taken by the UAE regulatory authorities, the Nigerian authorities are developing a framework to regulate marketing and promotion activities related to digital assets. Under this framework, digital asset promoters must obtain approval from the SEC, aimed at protecting retail investors from misleading or high-risk activities.