Nigeria moved to formally unify oversight of its crypto sector this month when President Bola Tinubu signed the Presidential Executive Order on Virtual Assets Coordination. The order establishes a Virtual Asset Council chaired by the Central Bank of Nigeria (CBN), with the Securities and Exchange Commission (SEC) as vice-chair, alongside the Nigeria Revenue Service (NRS, formerly known as the Federal Inland Revenue Service) and the Nigerian Financial Intelligence Unit. It took effect immediately on signing. The order is the latest attempt to resolve a jurisdictional conflict between two federal agencies that have spent years pulling in opposite directions over the same asset class, creating what practitioners describe as a dual-track regulatory environment in which licensing, banking access, and enforcement have operated on separate and often incompatible timelines.

The structural problem dates back nearly a decade. The CBN issued its first warning to banks about crypto in January 2017, then escalated in February 2021 by explicitly prohibiting banks from processing crypto transactions. The SEC moved in the opposite direction, declaring in September 2020 that digital assets with investment characteristics fell under its purview. That contradiction meant that firms the SEC might have licensed could not access the banking system. Trading moved almost entirely into peer-to-peer (P2P) channels during the ban years, and Nigerian P2P volumes climbed to roughly $56.7 billion by mid-2023. The CBN reversed its position in December 2023, permitting banks to open accounts for SEC-licensed crypto firms. That decision exposed the next bottleneck: the SEC had issued almost no licenses. The licensing gap was further deepened by the acute regulatory chill that followed the 2024 detention of Binance executive Tigran Gambaryan by Nigerian authorities; major platforms including OKX suspended or curtailed their Nigerian services during this period, and a $10 billion penalty claim against Binance remained outstanding. Global liquidity providers actively distanced themselves from the Nigerian market, making the absence of licensed local operators far more damaging in practice than the raw numbers suggest.

As of today, only two companies hold provisional Virtual Asset Service Provider (VASP) licenses under the SEC's Accelerated Regulatory Incubation Programme (ARIP): Busha Digital Ltd and Quidax Technologies Ltd, both approved in August 2024. An estimated 30 to 40 operators are still waiting for clarity. South Africa, by comparison, has issued 59 crypto licenses. The mismatch between the size of Nigeria's market and its licensing output is striking. Nigeria recorded approximately $92.1 billion in crypto transaction volume in the most recent measurement period, roughly three times South Africa's figures, according to data compiled by Finbold. An estimated 22 million Nigerians, about 10.3 percent of the population, hold or use crypto, with projections putting that figure between 26.3 and 30 million by the end of 2026. According to a 2025 Breet adoption report, stablecoins now account for roughly 40 percent of all crypto activity in the country, and 59 percent of crypto-active Nigerians hold USDT. The same report found that 95 percent of respondents preferred stablecoin transactions over payments in naira, a clear signal that currency instability is driving adoption more than speculation.

The licensing freeze created a specific legal contradiction after the government introduced a 25 percent income tax on individual digital asset gains, effective January 2026, with first-month non-compliance fines of 10 million naira. "How will they implement a tax regime next year without proper operator licences when only two platforms are licensed?" asked Rume Ophi, a financial analyst quoted by TechCabal in November 2025, speaking ahead of the January 2026 tax rollout. Ihenyen of the Virtual Asset Service Providers Association of Nigeria described the pace of licensing as "very concerning," attributing delays to systemic issues within the regulatory framework rather than the SEC alone. The gap leaves retail users on unlicensed or offshore platforms with no clear path to tax compliance, since only licensed platforms can generate the transaction records a compliant filing would require.

The executive order is one of two parallel tracks currently moving through Nigeria's government. The Virtual Asset Service Providers Regulation Bill (SB 956), sponsored by Deputy Senate President Barau Jibrin, has cleared its second reading in the Senate and is in committee review. Jibrin said the bill "seeks to bring order, confidence and accountability to Nigeria's growing virtual asset ecosystem without stifling innovation." If passed, it would enshrine in statute the coordination mechanisms the executive order established by decree. The Investments and Securities Act (ISA), signed on March 31, 2025, had already granted the SEC unambiguous primary authority over virtual assets, formally ending the legal grey zone that allowed both agencies to claim jurisdiction. Crucially, the ISA 2025 classifies virtual assets, including cryptocurrencies, NFTs, and tokens, as securities; that classification is the legal foundation on which the SEC's primary authority rests and directly justifies the capital requirements that followed. The SEC's Circular 26-1 raised minimum capital requirements for Digital Asset Exchanges and custodians from 500 million naira to 2 billion naira (approximately $1.25 million), with a compliance deadline of June 30, 2027. The executive order also establishes a Virtual Asset Office within the CBN to serve as the council's operational secretariat, responsible for licensing coordination, regulatory reporting, and inter-agency information sharing, a concrete structural provision that distinguishes this order from earlier and vaguer coordination attempts.

That capital threshold is expected to accelerate consolidation. Smaller local exchanges that cannot meet the new floor will face pressure to merge, seek acquisition, or exit. The CBN's planned regulatory sandbox for blockchain firms, mentioned in the executive order but not yet detailed, may offer a lower-barrier testing track for early-stage builders. Developers building fiat on-ramps or stablecoin payment integrations for Nigerian users already need a licensed local partner to access the banking system. On the continent, smaller markets in Kenya, Ghana, and Ethiopia are watching closely. Nigeria's Virtual Asset Council, if it functions as a genuine coordination body rather than a venue for continued turf disputes, could become a reference model for multi-agency crypto oversight across Sub-Saharan Africa. If the CBN and SEC revert to competing priorities behind the council structure, the lesson other markets draw may instead be that legislative mandates, like South Africa's Financial Sector Conduct Authority licensing process, are more durable than executive-order coordination frameworks.