Nigeria to ramp up crackdown on unregistered crypto exchanges

Nigeria’s Securities and Exchange Commission (SEC) is preparing to ramp up enforcement actions against crypto exchanges and other businesses operating outside of its regulatory oversight, according to local media reports.

The crackdown is part of the watchdog’s broader strategy to protect investors and maintain market stability in the country’s fast-growing digital asset sector, which is projected to reach $52.5 million by 2028.

Complying with rules

In a statement released on Sept. 8, SEC Director-General Emomotimi Agama reiterated the regulator’s commitment to ensuring all market participants comply with established rules.

Agama stated:

“We will soon commence enforcement actions against those who operate in this market without adhering to regulatory guidelines. Anyone unwilling to follow the proper channels will not be allowed to continue operations.”

Agama stressed that the commission is focused on promoting full transparency, anti-money laundering (AML) protocols, and measures to combat the financing of terrorism (CFT) within the digital asset space.

He further reassured stakeholders that the SEC’s role is not to stifle innovation but to create a structured environment where new technologies can flourish responsibly. He added that the regulatory push aims to strike a balance between fostering innovation and ensuring investor safety.

Regulatory actions

The SEC’s actions come just weeks after it granted its first-ever approval-in-principle to two local crypto exchanges, Quidax and Busha.

These exchanges are the only ones currently operating legally under the commission’s regulations. However, Agama told local media that several other applications are being reviewed, but exchanges will need to meet stringent standards to receive approval.

In addition to approving Quidax and Busha, the SEC has admitted four firms into its Regulatory Incubation (RI) Program, where they can develop and test their platforms under regulatory supervision.

The regulatory developments come after the country took legal actions against foreign exchanges like Binance and OKX, both of which have exited the country. Nigerian authorities said the exchanges were operating in the country without adhering to local regulations.