Nigeria's Senate advances its first crypto regulation bill

Senate Clears Second Reading on VASP Bill

Nigeria's Senate advanced the Virtual Asset Service Providers Regulation Bill 2026 to its second reading, with lawmakers warning that the absence of a regulatory framework is driving billions of naira in investments, jobs, and government revenue into the shadows. The bill, sponsored by Deputy Senate President Jibrin Barau, seeks to establish a legal, regulatory, and supervisory framework for virtual assets, digital assets, and Virtual Asset Service Providers (VASPs) in Nigeria.

The bill scaled its second reading after lawmakers argued that the absence of clear rules has exposed millions of Nigerians to fraud, financial losses, and other risks associated with digital assets. The proposed legislation seeks to create a comprehensive system for regulating virtual assets and VASPs, while introducing mandatory licensing, transparency, and compliance requirements for cryptocurrency exchanges operating in the country. The proposed law would also align with international standards set by the Financial Action Task Force (FATF) and the International Monetary Fund (IMF), and seeks to establish clear operating rules for all virtual asset service providers.

Leading the debate, Deputy Senate President Barau Jibrin said the bill seeks to bring order, confidence, and accountability to Nigeria's growing virtual asset ecosystem without stifling innovation. One senator framed the stakes plainly: without regulation, the market goes underground into a black economy, remains opaque and vulnerable to criminal activities, and undermines the digital economy's contribution to President Tinubu's $1 trillion economy target.

A Major Market Still Without a Framework

According to the bill's sponsor, Nigeria currently leads Africa in virtual asset adoption, but the lack of regulation poses significant risks. Blockchain analytics firm Chainalysis shows that Nigeria recorded approximately $59 billion in cryptocurrency transactions between July 2023 and June 2024, placing it among the world's largest crypto markets. Nigeria ranked among the top 15 countries in the 2025 Global Crypto Adoption Index.

Despite Nigeria recording one of the highest rates of cryptocurrency adoption in Africa, the country has lagged behind several peers in developing a clear regulatory framework for the sector. Senator Natasha Akpoti-Uduaghan noted that the lack of regulation was forcing many Nigerian technology entrepreneurs to establish their operations abroad. If eventually passed into law, Nigeria would join countries such as Kenya, South Africa, and Ghana in establishing a comprehensive regulatory framework for cryptocurrencies and virtual assets.

Following deliberations, the Senate referred the bill to the Senate Committee on Capital Market for further legislative scrutiny, with the committee expected to submit its report within four weeks.

Sources:
Daily Trust: Senate advances crypto regulation bill to curb fraud, protect digital economy
Channels Television: Senate Advances Crypto Regulation Bill To Protect Investors, Strengthen Digital Economy
Ripple: Crypto Regulation in Africa: What's Changing in 2026