Nigerian President Bola Tinubu has launched a comprehensive regulatory regime for Nigeria’s digital asset market, headlined by the creation of the Virtual Asset Regulatory Council.
A New Strategic Oversight Body
Nigerian President Bola Tinubu has unveiled a sweeping new framework to regulate the country’s fast-growing digital asset market, establishing the Virtual Asset Regulatory Council (VARC). Under the framework, the Central Bank of Nigeria (CBN) and the Nigeria Revenue Service (NRS) are joint overseers of non-security virtual assets under the Virtual Asset Regulatory Authority (VARA).
According to a local report, the new framework positions VARC as the strategic coordination body, co-chaired by the CBN governor and the NRS executive chairman. This level of coordination marks a significant shift in the country’s approach to fintech. Rume Ophi, a prominent industry analyst known as “Cryptopreacher,” said the move represents a turning point for the country’s crypto industry.
“In my almost 10 years in this industry, this is one of the most structured regulatory moves I’ve seen in Nigeria’s crypto space,” Ophi said. “The establishment of the VARC signals a more deliberate and coordinated approach to digital asset oversight. With VARC overseeing non-securities virtual assets, this suggests there’ll be clearer classifications and regulatory refinement as the framework evolves.”
A key feature of the regime is the clear distinction between security and non-security virtual assets. VARA will focus on non-security assets such as stablecoins, payment tokens and tokenized deposits, while the Nigerian Securities and Exchange Commission will continue to regulate assets classified as securities.
Ophi highlighted that this transition is not merely administrative but the fulfillment of a political promise. “What makes this significant is that it aligns with the president’s 2023 manifesto commitment to reform government policy to encourage the prudent use of blockchain technology and crypto assets. This looks like an attempt to implement that vision,” he added.
The unveiling of this new framework comes just over a month after a period of significant tension between regulators and the local tech ecosystem. The Nigerian SEC recently implemented a sharp increase in minimum capital requirements for digital asset firms — a move that drew immediate criticism from industry leaders and experts.
Critics argued that these heightened financial barriers would stifle domestic innovation, potentially forcing local startups to move their operations offshore to more friendly jurisdictions.
Registration and Operational Standards
The Blockchain Industry Coordinating Committee of Nigeria, or BICCON, was particularly vocal in its opposition, labeling the capital requirements “disproportionate.” In a bid to protect the local ecosystem, the association implored the SEC to engage in a collaborative dialogue to find a more balanced solution that ensures market integrity without sacrificing the growth of homegrown enterprises.
Under the new mandates, both local and offshore platforms must register and comply with rigorous know-your-customer and cybersecurity standards. In exchange for this compliance, firms will gain formal recognition and improved access to traditional banking services, alongside eligibility for regulated partnerships. Furthermore, a virtual asset sandbox will allow firms to test operations under supervision as licensing rules are phased in.
While the framework draws inspiration from international models like Dubai’s VARA, it reportedly adapts them by coordinating existing agencies rather than creating a standalone regulator.
“I’ll say this plainly: we haven’t seen this level of visible commitment to structured cryptocurrency regulation before,” Ophi said. “Credit should be given where it’s due.”
The Tinubu administration views the effort as part of its broader push to deepen Nigeria’s digital economy and achieve its ambition of building a $1 trillion economy by 2030. Whether the framework accelerates innovation and investor confidence — or adds another layer of bureaucracy — will depend on its implementation in the months ahead.
FAQ ❓
- What did President Tinubu announce? He launched the Virtual Asset Regulatory Council (VARC) to oversee digital assets.
- Who will regulate non‑security assets? The CBN and NRS act jointly under VARA, while the SEC handles securities.
- Why is this significant? Analyst Rume Ophi says it’s the most structured crypto regulation Nigeria has seen, aligning with Tinubu’s 2023 blockchain policy pledge.
- What does it mean for operators? Exchanges must register, meet KYC and cybersecurity standards, and gain access to banking services and regulated partnerships.
