Nigeria is abandoning its restrictive approach to cryptocurrency and replacing it with a coordinated regulatory framework that acknowledges the sector's economic importance while establishing clearer rules for institutional participation. In July 2026, President Bola Tinubu signed an executive order establishing a Virtual Asset Council, chaired by the Central Bank of Nigeria (CBN), to oversee digital assets across the country's financial, capital-market, revenue, and security agencies.

This shift represents a dramatic reversal from 2021, when the CBN restricted banks from facilitating cryptocurrency transactions. The new framework does not ban cryptocurrency ownership or trading; instead, it creates registration and supervision channels for companies operating in the sector. The move reflects Nigeria's status as a crypto powerhouse: the country ranked sixth globally in cryptocurrency adoption in 2025 and received more than $92.1 billion in on-chain value between July 2024 and June 2025, making it Sub-Saharan Africa's largest crypto market by a significant margin.

Why Is Nigeria Creating a Coordinated Crypto Regulator?

The previous fragmented approach to crypto oversight created regulatory gaps and overlapping responsibilities. Virtual assets function in multiple ways, simultaneously acting as investments, payment instruments, stores of value, and tools for transferring funds. This multifaceted nature made it difficult for any single regulator to oversee the entire sector effectively. According to Nigeria's Presidency, the fragmented system created opportunities for fraud, money laundering, terrorism financing, cybersecurity threats, and revenue losses.

The new Virtual Asset Council addresses these challenges through coordination rather than consolidation. The CBN chairs the council, while the Nigeria Revenue Service and Securities and Exchange Commission serve as vice-chairs. The Nigerian Financial Intelligence Unit and Office of the National Security Adviser are also members. A new Virtual Asset Office, housed within the CBN, will handle the council's daily operations, including processing applications, managing reporting, and facilitating information sharing through a common supervisory technology platform.

How Will Regulatory Responsibilities Be Divided Among Agencies?

The framework uses an activity-based approach to determine which regulator oversees which crypto business. This means a company's regulator depends on the specific service it provides and the nature of the assets it handles, rather than applying a one-size-fits-all rule.

• Securities Regulator Role: The Securities and Exchange Commission (SEC) continues to oversee virtual assets and services that qualify as securities or capital-market products, including digital asset exchanges, Virtual Asset Service Providers, and other digital asset operators under the Investments and Securities Act 2025.
• Central Bank Role: The CBN oversees payment, settlement, custody, and related services involving virtual assets that do not fall within the securities category, positioning the central bank as the primary supervisor for stablecoin companies, payment providers, and custodians.
• Coordination Function: The Virtual Asset Council determines responsibility when an activity does not fit clearly within one regulator's mandate, preventing regulatory gaps and reducing confusion for businesses operating across multiple service categories.

The framework coordinates existing powers instead of transferring them from one institution to another. This distinction is important for exchanges, custodians, stablecoin companies, payment providers, and other businesses seeking clarity on which agency will supervise their operations.

What Compliance Expectations Will Crypto Businesses Face?

The coordinated system will raise compliance expectations for legitimate operators. Companies serving Nigerian customers may face closer requirements concerning registration and minimum capital standards, customer identification and transaction monitoring, cybersecurity and asset custody, tax reporting and remittance, consumer complaints and disclosures, anti-money-laundering controls, and cross-agency data sharing.

The SEC has already introduced revised capital requirements for several digital-asset business categories, including exchanges, custodians, token issuers, and real-world asset tokenization platforms. Affected operators have until June 30, 2027, to comply with the new capital rules. The Nigeria Revenue Service is also expected to publish a dedicated virtual-asset tax policy explaining how existing tax laws apply to the sector and improving reporting certainty for businesses and taxpayers.

Additionally, the CBN is preparing a regulatory sandbox for virtual-asset products and blockchain-based services. This sandbox will allow eligible companies to test products under supervision before launching them across the wider market. Regulators will use the process to examine potential effects on financial stability, consumer protection, monetary sovereignty, market integrity, financial inclusion, and government revenue. The SEC's Accelerated Regulatory Incubation Programme already operates a similar initiative within the capital market; in July 2026, the SEC admitted GIGX Technologies and KuCoin Nigeria into the programme.

How Does This Framework Compare to Nigeria's Previous Crypto Policy?

Nigeria's regulatory position has shifted considerably over the past three years. In December 2023, the CBN issued guidelines allowing regulated financial institutions to operate accounts for approved Virtual Asset Service Providers, marking the first move toward controlled access between the banking and digital-asset sectors. The latest executive order advances that transition significantly.

The new framework does not make Bitcoin, stablecoins, or other privately issued cryptoassets legal tender. The eNaira, the CBN-issued digital form of Nigeria's sovereign currency, remains the only digital asset with legal-tender status. However, the order removes the blanket prohibition on crypto activity that characterized the 2021 banking restrictions, creating a middle ground between prohibition and unrestricted operation.

At the Nigeria Stablecoin Summit in Lagos, Nigeria Revenue Service official Oni Olushola stated that the framework would help regulators better understand how crypto companies operate while protecting participants and recognizing the sector's legitimate economic activity. This language reflects a fundamental shift in government perspective, from viewing crypto as a threat to viewing it as an economic sector requiring thoughtful oversight.

What Challenges Could Affect Implementation?

The executive order creates a clearer institutional structure, but its success will depend on effective implementation. Businesses will need to know how applications move between regulators, how quickly agencies make decisions, and what happens when services fall under more than one regulatory category. Regulators must also avoid turning coordination into duplicated compliance, where a company has to submit the same information repeatedly to several agencies simply because its services involve payments, securities, and taxation.

The strongest outcome would be a system that removes uncertainty while maintaining effective safeguards against fraud and financial crime. With the CBN chairing the Virtual Asset Council, Nigeria's crypto regulation has moved toward centralized coordination. The next test is whether that structure can protect consumers and support responsible innovation without creating unnecessary barriers to entry for legitimate operators.