On 20 August 2026, the Securities and Exchange Commission (SEC) issued its Proposed Rules on Digital and Virtual Assets Operations, Custody and Markets (the Proposed Rules). If implemented, the SEC Proposed Rules on digital assets would be the most comprehensive reform of Nigeria’s digital asset framework to date.
The Proposed Rules follow the Executive Order on Virtual Assets Coordination 2026, which aimed to harmonise a previously fragmented approach. In this newsletter, we outline their key requirements and what they mean for businesses operating in, or entering, Nigeria’s digital asset market.
How the SEC’s approach to digital assets has developed
- 2020 Statement: on 14 September 2020, the SEC recognised digital assets and cryptocurrencies as regulated securities.
- Extant Rules (May 2022): the first dedicated SEC framework, covering digital asset offering platforms, custodians, exchanges and Virtual Asset Service Providers (VASPs).
- ARIP Framework (June 2024): the Accelerated Regulatory Incubation Programme, a sandbox for VASPs.
- 2024 Proposed Amendments: added advertising standards, delisting rules and new intermediary categories. We covered these in our earlier newsletter.
- Revised Minimum Capital Guidelines 2026: raised capital requirements for operators in the digital asset ecosystem.
New categories under the SEC Proposed Rules on digital assets
The Proposed Rules add two new categories. A Digital Asset Platform Operator (DAPO) runs functions such as issuing, tokenising, minting or redeeming digital assets, including stablecoins. A Real-World Asset Tokenisation Platform (RATOP) tokenises real-world assets. Their share capital is ₦500 million and ₦1 billion respectively.
Every RATOP project must include an independent legal opinion from an SEC-registered solicitor. The opinion must confirm valid title, disclose any encumbrances, confirm investors’ enforceable rights and identify the governing law.
The scope of regulated VASP activity also widens. It now covers non-custodial wallets, staking, lending and borrowing, and yield-generating arrangements.
Exchanges, custodians and dealers
- Exchanges (DAX): limited to secondary trading. OTC trading, derivatives, leveraged tokens and automated market making need SEC approval, and an exchange must notify the SEC before delisting or suspending an asset.
- Custodians (DAC): must hold at least 80% of client assets in cold storage and use multi-signature or equivalent controls.
- Dealers: now formally defined. Anyone dealing in digital assets as a business, including providing liquidity, needs SEC registration.
- Share capital: ₦2 billion for exchanges and custodians, ₦500 million for offering platforms and ₦200 million for VASPs.
Stablecoins and tokenised assets
Stablecoins fall into four tiers, each with a minimum reserve:
- Tier 1: Naira-backed, at least 100%;
- Tier 2: foreign currency-backed, at least 120%;
- Tier 3: commodity-backed, at least 100%; and
- Tier 4: crypto-backed, at least 150%.
Algorithmic, reserve-less and synthetic stablecoins are prohibited. Using any stablecoin in capital market activity needs prior SEC approval, and foreign stablecoins need SEC recognition and a local representative. The Proposed Rules also recognise Asset-Referenced Tokens and Asset-Backed Tokens.
DeFi, cyber incidents and confiscation
Calling an activity “decentralised” will not place it outside the rules. It is regulated if an identifiable person controls the protocol, earns fees from it, governs it or promotes it.
In addition, material cyber incidents must be reported within 24 hours, with a full report within 48 hours. The rules also create a National Digital Assets Confiscation Wallet for assets subject to lawful orders. Finally, payment service providers that only provide fiat infrastructure need not register as VASPs.
ARIP becomes the main route to registration
The Proposed Rules supersede earlier SEC rules and circulars, including the ARIP Framework, and make ARIP the primary path to registration. An Approval in Principle now lasts two years. Existing capital market operators, firms registered in an IOSCO-member jurisdiction and certain bank subsidiaries may skip ARIP. The 10% customer growth cap is removed, and fees are set at ₦200,000 for initial assessment and ₦2,000,000 for an ARIP application.
Advertising and investor protection
No one may advertise a digital asset product unless it is registered or approved where required. Adverts must be fair, clear and balanced, and must not guarantee returns or understate risk. Regulated entities are responsible for influencer content and must disclose any paid endorsement.
For retail investors, limits rise to ₦1,000,000 per issuer and ₦10,000,000 in total over twelve months. Retail investors also get a five-business-day cooling-off period. By contrast, institutional, qualified and high net worth investors face no limits.
What the Proposed Rules mean for your business
Overall, the Proposed Rules move Nigeria towards a function-based framework. Every business will need certainty about which regulated function it performs, and whether its structure, capital, technology and governance can support it. Existing operators should review their business model, group structure, custody, client acquisition and fundraising plans now.
To read our full analysis, with rule references, use the download button below.
