The order, which takes immediate effect, creates two new bodies: the Virtual Asset Regulatory Council (VARC), a strategic governance structure co-chaired by the Governor of the Central Bank of Nigeria (CBN) and the Executive Chairman of the Nigeria Revenue Service (NRS), and the Virtual Asset Regulatory Office (VARO), an operational arm housed within the CBN that will serve as the primary point of contact for firms dealing in non-security virtual assets. A third formal element consists of Agency-Based Virtual Asset Regulatory Teams embedded within each participating institution, operating under their existing legal mandates rather than established as standalone entities. Participating agencies include the CBN, the NRS, the Securities and Exchange Commission (SEC), and the Nigerian Financial Intelligence Unit (NFIU).

The order does not create an entirely new standalone regulator. Instead, it gives legal standing to a coordination architecture that the government had been building since August 2025, when a preliminary Virtual Asset Regulatory Authority was established by presidential directive. A December 2025 white paper endorsed by Tinubu set the direction for that effort. In February 2026, the administration signalled it would use existing regulatory powers rather than waiting for new legislation. Thursday's executive order is the next step in that sequence.

"We will adopt a regulatory approach that is proportionate, evidence-based, and aligned with global standards," Tinubu wrote in the white paper foreword in December 2025. "Initially, we do not intend to introduce new legislation."

The scale of the market he is now formally addressing is substantial. Nigerian on-chain crypto transaction volume reached $92.1 billion in the year ending June 2025, according to Chainalysis data as reported by TechCabal, roughly three times the volume recorded in South Africa, the continent's second-largest market.

An estimated 27 to 30 million Nigerians are expected to be active crypto users by the end of 2026, with around 47 percent of adults reporting they own or use digital assets. Total crypto holdings by Nigerians are estimated at $59 billion, according to a report from financial research firm FDC. These figures are third-party estimates drawn from sources with varying methodologies.

The structural weakness of the naira has been a key driver of that adoption. The currency has lost more than 75 percent of its value against the US dollar since 2019, moving from roughly 360 naira per dollar to over 1,400. That depreciation has pushed Nigerians toward stablecoins as a tool for savings, remittances, and business payments. Nigeria is the world's largest stablecoin market outside the United States. Tether's USDT accounts for approximately 88.5 percent of stablecoin transactions in the country, and daily peer-to-peer crypto trading volume sits at $48.2 million. This stablecoin economy sits in a regulatory grey zone under the new framework. The CBN holds authority over payment systems, while the SEC governs securities, and it is not yet clear which agency will take the lead on stablecoin issuers and the on-ramp and off-ramp providers that connect those two worlds.

That ambiguity points to a broader jurisdictional tension that legal and compliance teams will need to watch. The Investments and Securities Act of 2025 designates the SEC as the primary regulator for all virtual assets, while the VARC framework places the CBN and NRS in co-leadership positions. For now, firms operating in Nigeria face two parallel compliance tracks: security tokens and virtual asset service providers register with the SEC under the ISA 2025, while non-security virtual assets fall under the CBN's VARO structure. Companies building wallets, decentralised finance interfaces, or stablecoin infrastructure will need to determine which track applies to their product and may find that both do. Both tracks are already operational: the SEC has admitted nine virtual asset service providers into its Accelerated Regulatory Incubation Programme, and the CBN launched an AML/CFT supervision pilot in April 2026. VARO's operational guidelines have not yet been published.

The 2024 detention of Binance executives Tigran Gambaryan and Nadeem Anjarwalla, and the subsequent charges involving $26 billion in unidentified transactions, tax evasion, and naira manipulation, accelerated the regulatory push that produced this order.

The prominent roles given to the NFIU and the CBN within VARC suggest that anti-money laundering enforcement and foreign exchange stability are core priorities alongside innovation policy. Exchanges operating in Nigeria or considering re-entry should expect more structured scrutiny than in earlier years.

Nigeria's size means its regulatory decisions carry weight across the continent. Kenya introduced user-verification requirements in May 2026, South Africa has required VASP licensing since 2023, and Ghana is also tracking Nigeria's approach as it develops its own framework. A formalised Nigerian framework will likely accelerate regulatory timelines in Francophone West Africa and East Africa, where many projects are weighing regional expansion strategies.

The Nigerian Senate is still processing the VASP Regulation Bill of 2026, sponsored by Deputy Senate President Jibrin Barau, which advanced to a second reading in June and was referred to the Senate Committee on Capital Market. The executive order and existing statutes are the operative legal instruments for now. How VARC resolves the overlap with the ISA 2025, and when VARO releases its operational guidelines, will determine whether the framework delivers the clarity that businesses in this market have been waiting for.