The recently updated Investment and Securities Act (ISA) of 2025 has officially recognized cryptocurrency and other digital assets as a legal asset class in Nigeria, marking a historic shift in the country’s approach to digital finance. Experts say this bold legal reform could reshape the Nigerian capital market and push traditional financial players to evolve or risk obsolescence.
This landmark development was dissected during a recent episode of Nairametrics’ YouTube show “Drinks and Mics”, hosted by Ugo Obi-Chukwu, CEO of Nairametrics, and featuring industry leaders like Tunji Andrews (CEO of Awabah), Arnold Dublin-Green (CiO of Cordros Capital), and Buchi Okoro (CEO of Quidax).
The Four Recognized Crypto Market Players Under ISA 2025
When asked which players now fall under regulatory supervision in Nigeria’s digital asset market, Buchi Okoro outlined four major categories of entities now recognized under the Securities and Exchange Commission (SEC) crypto guidelines:
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Virtual Asset Service Providers (VASPs): These include platforms like crypto wallets and other infrastructure providers that help users store, send, or receive virtual currencies.
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Digital Asset Exchanges: Platforms such as Quidax that allow users to buy, sell, or trade cryptocurrencies fall under this classification.
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Digital Asset Offering Platforms (DAOPs): These are portals that facilitate Initial Coin Offerings (ICOs), token sales, or any kind of asset-backed token launch.
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Digital Asset Custodians: Entities that provide secure storage solutions for crypto assets, particularly for institutional investors or retail users looking for third-party custody services.
Okoro emphasized that all four player types must now be licensed by the SEC to operate legally in Nigeria.
Traditional Finance Players Face Existential Threats
During the panel discussion, the conversation shifted to the impact of the new crypto regime on traditional capital market participants. The consensus was clear: registrars and clearing system managers are under threat.
One panelist bluntly stated:
“Unless they evolve and automate their processes further, I would sell them.”
The general sentiment was that traditional firms slow to adopt AI, blockchain, and digital transformation would soon become irrelevant in Nigeria’s fast-evolving financial sector.
In contrast, asset managers received a more optimistic assessment. The panelists agreed that they remain a stronghold, provided they pivot quickly, embrace automation, and integrate AI tools into their portfolio management strategies.
The Journey From ISA 2007 to ISA 2025
Before this overhaul, the ISA of 2007 did not account for the rise of digital assets. The first regulatory attempt came in 2020, when the SEC released a framework that treated cryptocurrencies and other tokens as securities. However, enforcement was weak due to a lack of legal support.
That gap has now been closed.
The ISA 2025 gives the SEC full statutory authority to regulate, license, and enforce crypto activity in Nigeria. It covers digital assets, tokenized offerings, and virtual currencies, placing them firmly under capital market oversight.
According to Okoro, this clarity will rebuild investor trust, boost market participation, and help stabilize volatility.
“With more people entering the market, there’s more liquidity, which naturally reduces volatility,” Okoro explained. “Tighter regulations and more responsible players are bringing order to the space.”
The SEC’s “Crypto Smart” Initiative and Long-Term Strategy
In June 2025, the Nigerian SEC launched “Crypto Smart, Nigeria Strong”, a forward-thinking initiative aimed at expanding digital finance literacy and developing robust stablecoin regulations.
The program focuses on three core pillars:
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Collaboration across regulatory bodies and private sector players
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Innovation in product design, particularly around digital asset ETFs and tokenized securities
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Trust built through transparency, investor education, and user protection
Targeting young Nigerians, especially in schools and universities, the initiative teaches:
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The basics of blockchain technology
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How to detect scams
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The principles of long-term investing
The SEC is also exploring:
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Digital Asset ETFs to broaden access to crypto investment
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Secure wallets for pension funds to hold tokenized assets
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Tokenized securities that allow institutional investors to access new forms of capital
These efforts are part of a larger push to integrate digital finance into Nigeria’s mainstream economy while protecting investors from systemic risks.
Crypto Regulation Aligning Nigeria with Global Trends
The Nigerian crypto framework now aligns with global regulatory trends, where countries such as the United States, United Kingdom, Singapore, and the European Union have moved to introduce clear legal regimes for digital assets.
Experts argue that this move could also attract foreign direct investment and encourage international crypto exchanges and fintech companies to consider Nigeria as a key market.
Despite recent clampdowns in countries like the U.S., panelists pointed out that regulation—done right—invites innovation rather than stifling it.
Final Thoughts
The recognition of cryptocurrency as an asset class under Nigeria’s ISA 2025 marks a turning point for digital finance in West Africa’s largest economy. With the formal inclusion of VASPs, exchanges, offering platforms, and custodians in the SEC’s regulatory framework, Nigeria is now one of the most forward-facing African nations when it comes to crypto legislation.
The coming months will test how quickly both startups and legacy institutions adapt to the new digital economy. But one thing is certain: Nigeria’s financial future is now inseparable from blockchain, digital assets, and the regulatory frameworks that govern them.
