The Nigerian Securities and Exchange Commission (SEC) has revised its Digital Asset Rules, introducing stricter requirements for virtual asset service providers (VASPs) and social media influencers, also known as “Finfluencers.”
Under the updated rules, VASPs must obtain prior approval from the SEC before engaging third-party service providers to promote their crypto products. They must also ensure compliance with the SEC’s marketing standards. Social media influencers promoting cryptocurrency products must secure a “no-objection authorization” from the SEC and verify the licensing status of the companies they represent. Influencers are required to disclose any payments received for promotions. Non-compliance could result in penalties, including a fine of at least 10 million Nigerian naira (approximately $6,400) or up to three years in prison.
The rules aim to regulate crypto-related marketing promotions and advertisements, targeting unauthorized promotions of financial investment products on social media and other platforms. These regulations are scheduled to take effect on June 30, 2025.
The revised rules were announced in December 2024 and will come into effect in June 2025. The SEC has also outlined plans for enforcement actions against unregulated crypto activities starting in 2025.
The rules apply to any virtual asset service provider offering services to Nigerian residents, reflecting the SEC’s commitment to fostering a regulated crypto market in the country.
The SEC stated that the updated rules aim to curb the rising influence of unauthorized financial promotions by social media influencers and protect Nigerian investors from misleading crypto ads. The move is part of a broader strategy to ensure a transparent and regulated crypto ecosystem, especially as only two exchanges—Quidax Technologies and Busha Digital—currently hold SEC licenses to operate in Nigeria.
The SEC plans to actively monitor crypto advertisements to ensure compliance with the new rules. Violations will result in enforcement actions, including fines and potential criminal charges. The rules reflect the agency’s proactive stance in addressing unregulated crypto transactions and fostering a safer investment environment for Nigerian consumers.
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