Nigeria's SEC Introduces Stablecoin Regulations under 2025 Act in Policy Shift

Nigeria’s Securities and Exchange Commission (SEC) has unveiled a regulatory framework to formalize stablecoin operations under the Investment and Securities Act 2025, signaling a strategic shift toward structured digital asset integration. The new rules require stablecoin issuers to obtain licenses, maintain reserve backing, and adhere to anti-money laundering (AML) and know-your-customer (KYC) standards. This follows earlier enforcement actions, including a $81.5 billion lawsuit against Binance filed in February 2025 over alleged currency devaluation and tax evasion. SEC Director-General Emomotimi Agama emphasized the initiative’s dual goals: fostering innovation while ensuring market stability, stating, “Nigeria is open for stablecoin business, but on terms that protect our markets and empower Nigerians” [1].

The framework introduces the Accelerated Regulatory Incubation Program (ARIP), a regulatory sandbox allowing startups to test stablecoin products under supervision. Agama described Lagos as a potential “stablecoin hub of the Global South,” envisioning a Nigerian-issued stablecoin facilitating cross-border trade within five years. This aligns with Nigeria’s growing demand for dollar-backed stablecoins, driven by persistent naira volatility and the need for reliable transaction mediums. By designating stablecoins as securities under the 2025 Act, the SEC aims to safeguard investors and ensure market integrity, requiring compliant firms to transition from pilot phases to full-scale operations [5].

The policy shift reflects a departure from Nigeria’s earlier adversarial approach to crypto regulation. In March 2025, Information Minister Mohammed Idris stated that enforcement efforts prioritize strengthening laws over criminalizing operators, asserting, “We are ensuring that no one comes and operates without regulation.” This aligns with the SEC’s focus on balancing innovation with risk mitigation, as outlined in Agama’s remarks at the Nigeria Stablecoin Summit in Lagos. He underscored the importance of “nation-building” through digital assets, highlighting their potential to reduce transaction costs, expand financial inclusion, and model responsible integration in Africa [5].

A key element of the framework is the SEC’s dual role as both regulator and innovation advocate. By mandating reserve requirements and ongoing oversight, the agency aims to address risks identified in past enforcement cases, such as volatility-driven fraud. The Central Bank of Nigeria (CBN) retains authority over payment systems, while the SEC oversees broader market stability, creating a cohesive regulatory divide. This approach aligns with global trends, such as the U.S. GENIUS Act, which introduces federal licensing for stablecoin issuers [6]. By embedding legal clarity and consumer protections, Nigeria positions itself to attract domestic and international investors, leveraging its strategic location and digital economy.

The success of this framework hinges on stakeholder collaboration. Agama acknowledged that Lagos’s emergence as a fintech hub depends on attracting stablecoin operators while maintaining investor safeguards. The SEC’s vision for a Nigerian stablecoin requires coordination with the CBN and private-sector participants to ensure interoperability and adoption. Emphasizing “African solutions,” the policy prioritizes localized oversight over generic global frameworks, addressing Nigeria’s unique economic challenges [5].

Critics note that enforcement rigor and adaptability will determine the framework’s effectiveness. The SEC’s focus on reserve-backed models and localized oversight aims to prevent unregulated market pitfalls, but sustained compliance remains a challenge. Meanwhile, Nigeria’s experience could influence broader regional fintech developments, particularly in markets grappling with fiat currency instability. By balancing innovation with stability, Nigeria’s regulatory approach offers a potential blueprint for African nations seeking to harness digital assets responsibly.

Source: [1] [Nigeria Opens Doors to Regulated Stablecoins in Policy Shift] [https://www.mitrade.com/au/insights/news/live-news/article-3-987155-20250725] [5] [Nigeria open to stablecoins, says SEC] [https://punchng.com/nigeria-open-to-stablecoins-says-sec/] [6] [GENIUS Act Signed: What's Next For Digital Assets?] [https://www.bitgo.com/resources/blog/genius-act-signed/]