Nigeria has taken a significant step towards regulating cryptocurrencies with the signing of the Nigerian Investments and Securities Act (ISA) 2025 into law.
Cryptocurrency Officially Recognized As Asset Class
The Nigerian Investments and Securities Act (ISA) 2025, recently signed into law by President Bola Ahmed Tinubu, has effectively ended the uncertainty surrounding the status of cryptocurrencies. According to Ophi Rume, a local crypto advocate and educator, the amended securities law “officially” recognizes cryptocurrencies as an asset class.
This recognition not only ends the uncertainty around cryptocurrencies but also means they are no longer banned assets. Furthermore, Rume said, law enforcement agencies that were “harassing” people involved with these assets will have to stop.
Rume’s remarks came days after the Securities and Exchange Commission (SEC) of Nigeria said the new act effectively overrides the Investments and Securities Act No. 29 of 2007. Director-General Emomotimi Agama said the new law empowers SEC Nigeria to foster innovation and protect investors more efficiently. He added that it repositioned Nigeria as a competitive destination for local and foreign investments.
Besides recognizing digital assets and investment contracts as securities, the ISA 2025 also explicitly places virtual asset service providers (VASPs) under SEC Nigeria’s regulatory purview. The law also prohibits Ponzi schemes and threatens stiff penalties, including jail terms, for promoters of the schemes.
While the proposed penalties for Ponzi schemes have been welcomed by players in Nigeria’s crypto industry, Rume warns that this section will have to be amended to ensure the financial penalties remain commensurate.
“This is because the fine of 20 million naira [$13,000] may seem small for a platform that has scammed a lot of people out of huge amounts of money in dollars, let’s say $500,000. The fine will be something to easily do away with,” the educator said.
Overall, Rume said SEC Nigeria should encourage innovation in the crypto market and offer tax holidays to foreign crypto firms looking to enter the country.
