The Securities and Exchange Commission (SEC) has proposed a minimum capital requirement of up to ₦2 billion alongside a ₦30 million registration fee for Nigerian digital asset or crypto operators.
These proposals form part of the SEC’s draft rules governing “Digital and virtual asset operations, custody and markets,” released on August 20.
Under the proposed regulatory framework, digital asset exchanges, digital asset custodians, digital asset platform operators, digital asset offering platforms, and real-world asset tokenization platforms will each be subject to the ₦30 million registration fee.
Additionally, the commission suggested various minimum capital requirements for operators. Digital asset platform operators, digital asset offering platforms, and real-world asset tokenisation platforms would need ₦500 million each, while digital asset exchanges and custodians would need ₦2 billion each.
In addition to a ₦100,000 processing cost and a ₦300,000 application fee, virtual asset service providers would need a minimum capital of ₦200 million.
Additionally, the SEC suggested that regulated organisations keep a fidelity insurance bond that covers a minimum of 25% of their minimum paid-up capital.
The commission proposed a ₦200,000 initial assessment cost and a ₦2 million application fee for businesses looking to participate in the Accelerated Regulatory Incubation Programme.
he framework also introduces ongoing supervisory fees calculated as a percentage of a regulated firm’s turnover. During the incubation phase, digital asset exchanges would be charged 0.015 percent of their adjusted turnover, while other entities would incur a 0.0075 percent rate.
Upon securing full registration, the supervision fee—payable quarterly or at intervals specified by the commission—would rise to 0.025 percent of adjusted turnover for digital asset exchanges and 0.015 percent for all other regulated entities.
SEC considers N1m investment cap per issuer, N10m aggregate limit
Additionally, the commission proposed capping the total amount individual investors can commit to digital asset offerings.
Under the proposed rules, a retail investor would be restricted to investing no more than ₦1 million in a single issuer, with a cumulative cap of ₦10 million across multiple digital asset offerings within a one-year period.
The SEC noted that extra safeguards will apply to investors seeking to deposit more than ₦1 million or 5% of their net worth, whichever is higher.
These safeguards require digital asset offering platforms to issue an explicit risk warning, obtain the investor’s express consent, and confirm that the investor fully understands the nature and risks involved in the investment.
Prior to accepting an investment, platforms would also be required to evaluate the investor’s knowledge, experience, financial standing, and capacity to handle potential losses.
The SEC specified that digital asset platforms must implement mechanisms to track and enforce these investment caps while maintaining records of all risk warnings, user consents, and suitability assessments.
However, these proposed financial limits may not apply to institutional, qualified, or high-net-worth investors, alongside other accredited categories recognized by the commission.
SEC proposes general rules for crypto operators
Under the proposed framework, no individual or entity would be permitted to target Nigerian citizens or conduct digital or virtual asset operations within Nigeria without prior SEC registration, permission, or authorization.
Furthermore, operators would be required to comply with the commission’s additional governance requirements alongside Nigeria’s broader corporate governance code.
The SEC also outlined proposed conditions for foreign stablecoin issuers seeking to operate in Nigeria, including the designation of a local representative, proof of authorization in a recognized foreign jurisdiction, and compliance with Nigeria-specific reserve, liquidity, and redemption regulations.
Furthermore, the commission proposed that entities seeking to participate in Nigeria’s cryptocurrency sector must register under the Accelerated Regulatory Incubation Program (ARIP).
Backstory…
The proposed rules mark another step in the SEC’s effort to tighten oversight of crypto operators and other businesses participating in Nigeria’s digital-asset market.
The commission released the proposed Rules on Digital and Virtual Assets Operations, Custody and Markets on August 20, covering exchanges, custodians, platform operators and other digital-asset businesses operating in or targeting Nigerian investors.
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