Nigeria to adopt law allowing cryptocurrencies

Nigeria is preparing a new law that would make crypto assets legal in the country, ending years of ambiguity and legal void.

Under the new law, a crypto asset is defined as “a digital representation of value that can be transferred, digitally traded and used for payment or investment purposes.”

The new legislation will end a legal void in the country where cryptocurrencies have been used at a large scale to hedge against inflation.

A survey by forbes found that 47% of Nigerians use cryptocurrencies. This high percentage reflects Nigeria’s ranking at the 11th position globally in 2022, ahead of Kenya (ranked 19th) in the Global Crypto Adoption Index by Chainalysis.

However, Regulatory notices in 2021 from the Central Bank of Nigeria (CBN) expressly banned the use of Bitcoin, further prohibiting financial businesses from “dealing with cryptocurrencies”.

In December 2023, the Central Bank of Nigeria (CBN) lifted its ban on banks operating accounts for crypto service providers.

This move was followed by the Nigerian Securities and Exchange Commission (SEC) releasing guidelines for banks to open cryptocurrency accounts in January 2024.