Nigeria’s fintech industry is calling on the Central Bank of Nigeria (CBN) to provide clearer rules on what licensed institutions are legally allowed to do in the cryptocurrency market. Operators say prolonged uncertainty around regulation is slowing innovation, discouraging serious investment, and limiting institutional participation in the country’s growing digital asset ecosystem.


These concerns are documented in the CBN’s newly released Fintech Report, published on Monday. The report is based on stakeholder surveys, closed-door workshops, and industry roundtables held with fintech operators across the country. It reflects a growing consensus that while crypto assets are becoming more relevant to Nigeria’s financial system, unclear policies remain a major obstacle to responsible growth.



Regulatory Uncertainty as a Barrier to Growth


Despite Nigeria’s strong position in global crypto adoption, many fintech firms say they are still operating in a regulatory grey area. While some guidelines exist, there is no comprehensive framework that clearly outlines which crypto-related services are permitted, restricted, or prohibited for licensed financial institutions.


This lack of certainty makes long-term planning difficult and increases compliance risks. As a result, many banks and fintech companies are reluctant to invest in crypto infrastructure or launch new digital asset products. According to the report, regulatory ambiguity continues to limit participation and weaken Nigeria’s competitiveness in the global digital economy.


Industry players argue that without clear rules, even well-intentioned firms are forced to remain cautious, slowing the pace of innovation and market development.



Industry Demand for a Risk-Based Framework


Participants in the CBN consultations expressed strong support for a regulatory model based on risk assessment rather than blanket restrictions. They believe that regulation should focus on specific activities and their associated risks, instead of treating all crypto services as equally dangerous.


The report notes that stakeholders broadly agreed on the need for “a risk-based, activity-focused regulatory framework.” It further states that key recommendations include clarifying permissible activities for licensed institutions, such as custody services, tokenisation, and stablecoin operations.


Fintech operators want regulators to clearly define what is allowed and under what conditions. This, they believe, would encourage responsible participation while maintaining effective oversight.



Areas Requiring Immediate Policy Guidance


Several core aspects of crypto operations were identified as needing urgent regulatory clarity. These include digital asset custody, tokenisation of real-world assets, stablecoin issuance, cross-border crypto payments, and institutional trading frameworks.


In the absence of formal approval in these areas, many licensed firms avoid entering the market, even when strong business cases exist. Operators say this hesitation is not due to lack of interest but fear of regulatory sanctions or policy reversals.


Clear guidance in these sectors, they argue, would unlock new opportunities and promote compliant innovation.



Strengthening Consumer Protection and Market Integrity


The report also highlights widespread concern about consumer safety in the crypto market. Stakeholders urged the CBN to issue clearer advisories on price volatility, fraud prevention, and risk disclosure.


While participants acknowledged the risks of speculative trading and illicit financial flows, they cautioned against labelling all crypto-related activity as criminal. According to respondents, many major scams originate outside Nigeria, even though the country often faces reputational damage when such cases emerge.


Fintech leaders believe that targeted supervision and public education would be more effective than broad restrictions. By distinguishing between legitimate businesses and bad actors, regulators can strengthen market integrity without stifling innovation.



Learning from International Regulatory Models


As Nigeria continues to refine its crypto policy, stakeholders pointed to successful global frameworks that balance oversight with innovation. Two models frequently cited were Singapore’s digital asset licensing regime and the European Union’s Markets in Crypto-Assets (MiCA) framework.


Singapore’s system is known for clearly defining approved activities, enforcing strong compliance standards, and encouraging institutional participation. The EU’s MiCA framework provides unified rules across member states, applies proportional supervision, and strengthens consumer protection.


Both models emphasize transparency, consistency, and accountability. The report suggests that adopting similar principles could help Nigeria improve investor confidence, enhance financial stability, and attract reputable global players.




Current Regulatory Landscape in Nigeria


In December 2023, the CBN released guidelines allowing Virtual Asset Service Providers (VASPs) to open accounts with Nigerian banks. This move was widely seen as a positive step, as it restored banking access to crypto firms and reduced reliance on informal financial channels.


However, fintech stakeholders say the guidelines lack detailed operational rules. Without clear enforcement mechanisms and activity-based permissions, the policy has had limited practical impact.


The report also raises concerns about coordination between the CBN and the Securities and Exchange Commission (SEC). Industry players warn that fragmented oversight creates compliance confusion and weakens regulatory effectiveness, particularly for licensed financial institutions.


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SEC Approvals and Market Bottlenecks


As part of efforts to regulate crypto activities, the SEC granted Approval-in-Principle to Quidax and Busha in August 2024 under the Accelerated Regulatory Incubation Program. The approvals gave the exchanges legal recognition and signalled progress in formalising the sector.


At the time, the SEC stated that other applications were under review and would be assessed individually. However, more than a year later, no additional exchanges have reportedly received similar approvals.


Several applications remain pending, raising concerns about slow processing timelines and limited transparency. For many industry observers, this delay reinforces the need for clearer and more predictable regulatory pathways.


Why Regulatory Clarity Is Critical


Nigeria remains one of Africa’s largest crypto markets by adoption and transaction volume. Yet policy uncertainty continues to limit its full potential. Fintech operators believe that transparent, principles-based regulation could legitimise compliant players, reduce fraud risks, improve Nigeria’s global image, and attract institutional capital.



Without clear rules, the country risks losing talent, investment, and market leadership to jurisdictions with more structured regulatory environments. Industry leaders warn that prolonged uncertainty could push innovation into informal channels, making oversight even more difficult.



Nigeria’s fintech sector is not calling for deregulation. It is calling for direction. Operators want clear, consistent, and enforceable rules that define what is permitted and how risks should be managed.


By adopting a risk-based, activity-focused framework, the CBN has an opportunity to transform uncertainty into opportunity. Clear regulation would not only protect consumers and strengthen financial stability but also position Nigeria as a credible hub for digital asset innovation.



For industry stakeholders, the message is straightforward: strong and transparent rules enable growth, while unclear policies hold it back. If Nigeria wants to remain competitive in the global digital economy, regulatory clarity in crypto is no longer optional. It is essential.