Nigeria Proposes New Law to Regulate Crypto Influencers and Virtual Asset Providers

The Nigerian Securities and Exchange Commission (SEC Nigeria) has proposed a new law designed to address the issue of crypto influencers using their platforms to promote questionable crypto projects.

Nigerian SEC Proposes New Law to Curb Crypto Influencers Promoting Questionable Projects

The Nigerian Securities and Exchange Commission (SEC Nigeria) has proposed a new law to address the issue of crypto influencers using their platforms to promote questionable crypto projects.

The new rule, expected to take effect in June 2025, mandates that every crypto platform or Virtual Assets Service Provider (VASP) must be registered and hold a license from SEC Nigeria before engaging in any promotional activities on social media, TV, or print media.

According to the new law, crypto influencers are required to disclose to their community when they are paid to promote a digital asset or service. Failure to comply could result in a fine of N10 million Naira (~$6,500) and a prison sentence of up to 3 years.

Moreover, any VASP engaging the services of an influencer to promote a platform or a token must obtain a “No objection authorization” from the commission before engagement. Besides influencer marketing for all other advertisements and promotional activities, approval of the SEC must also be sought.

The law is contained in a new document titled “Re-exposure of Amendments to Rules on Digital Assets Issuance, Offering Platforms, Exchange and Custody” which includes revised amendments to the existing regulations for virtual asset providers in Nigeria.

According to SEC Nigeria, the revised Digital Assets (DA) Rules now cover new virtual assets activities and business models such as:

Key introductions in the Revised Rules include Requirements for:

Two Nigerian-owned crypto exchanges, Busha and Quidax, were the first to receive licenses from the Nigerian SEC in 2024, marking the beginning of a new phase of regulation in the country’s crypto space.

nigerian crypto exchange quidax receives provisional operating license from nigerian sec

With the license granted by the Nigerian SEC, Quidax is now able to collaborate with banks and other financial institutions, subject to the Central Bank of Nigeria’s… pic.twitter.com/4gPpLyJi4z

— BitKE (@BitcoinKE) August 29, 2024

The revised digital assets regulations can be found here.

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