Nigeria’s financial ecosystem is changing, and the newly signed Investment and Securities Act (ISA) 2025 is at the heart of this transformation.
For the first time in nearly two decades, Nigeria has updated its capital market laws, bringing fresh regulations that affect everything from traditional investments to cryptocurrencies.
What is the ISA 2025?
The Investment and Securities Act (ISA) 2025 is Nigeria’s new law governing investments, securities, and capital markets. It was signed by President Bola Ahmed Tinubu in March 2025 and replaces the ISA 2007, which had been in place for 18 years.
The update was necessary because the country’s financial system has evolved, especially with the rise of cryptocurrencies, fintech, and digital investments, and the old law no longer covers these modern developments.
The new Act gives more power to the Securities and Exchange Commission (SEC), Nigeria’s leading financial market regulator. It also introduces stricter rules against fraud, better investor protection, and clear guidelines for digital assets like Bitcoin and other cryptocurrencies.
Key changes in the ISA 2025
Crypto and digital assets are now officially recognised
One of the biggest changes is that virtual assets like Bitcoin, Ethereum, and stablecoins are now classified as securities. This means that crypto exchanges like Binance, Luno, or local platforms must register with the Securities and Exchange Commission.
Also, token creators, including meme coin developers, must follow local rules, and any fraudulent crypto schemes will face heavy penalties.
Before now, the region’s stance on crypto was unclear. In 2021, the Central Bank of Nigeria (CBN) banned banks from processing crypto transactions, forcing traders to use peer-to-peer (P2P) methods. Now, with the ISA 2025, crypto is regulated, not banned, which could bring more stability and trust to the market.
“The Act creates big hurdles for smaller crypto players,” says Onionsman, CEO of Monierate, suggesting it may favor only those with deep pockets.
2. Ponzi schemes and fraud face harsh penalties
Nigeria has seen too many Ponzi schemes in recent years, like MMM, Ultimate Cycler, and fake forex investments, like the recent scam (CBEX) that wiped out people’s savings. But with the new Investment and Securities Act (ISA) 2025, things are changing.
The Act now clearly bans such scams and imposes tough penalties for promoters, including up to 10 years in prison and a minimum fine of ₦20 million.
To fight fraud more effectively, regulators now have the power to access telecom data to track and arrest fraudsters.
This is a major win for everyday Nigerians who have been victims of financial scams. The goal is to clean up the investment space and protect people from shady operators.
3. Foreign crypto exchanges must register in Nigeria
The Act now requires foreign crypto platforms like Binance, KuCoin, Bybit, and so on to set up a physical presence in Nigeria if they want to operate here. This move aims to boost accountability and protect Nigerian users, but it may also create hurdles for smaller crypto startups due to high compliance costs.
The rule means global platforms must follow local laws, which could lead to better customer support and safer transactions for users. Some fear this rule could push smaller crypto businesses out of the market due to high compliance costs.
“We’re transitioning from building cautiously to building officially,” said Heritagee Falodun, Co-Founder of Cashwyre. “It may be tough at first, but it’s necessary for long-term growth.”
4. Stronger SEC powers for investor protection
The SEC now has more authority to enforce rules, investigate fraud, and protect investors. Offenses like market manipulation and insider trading will face tougher penalties. Additionally, a revamped Investment and Securities Tribunal will handle investor complaints faster.
This means quicker justice and better protection for investors.
“The ISA 2025 is a positive and necessary evolution for the digital asset space in Nigeria,” said Ayotunde Alabi, CEO of Luno Nigeria. “But how it’s implemented will matter just as much as the law itself.”
5. Legal entity identifier (LEI) requirement
Every major market participant, company, broker, and fund manager must now have a Legal Entity Identifier (LEI)—a unique ID for financial transactions.
Why? To improve transparency and make it easier to track illegal activities. It also means more compliance steps for businesses, especially smaller ones that may struggle with the extra requirements.
Still, the LEI system aims to make the market safer and more trustworthy for everyone.
What the new law means for investors and businesses
Crypto traders can expect more security, as exchanges must now follow SEC rules, reducing scams and shady practices. However, some foreign platforms may leave the market if they can’t meet local registration requirements. There’s also the possibility of future crypto tax laws, such as a capital gains tax on profits.
The new law strengthens protection against fraud and Ponzi schemes for traditional investors in stocks, bonds, and mutual funds. It also encourages new investment products, like state government bonds and commodities, and speeds up the handling of complaints.
Startups and fintech businesses, especially in crypto, face new challenges. Due to registration and regulation requirements, compliance costs may rise, which could be tough for smaller players with limited funding. On the positive side, operating under SEC oversight brings more legitimacy, which may attract serious investors and users.
Overall, the Investment and Securities Act 2025 aims to make Nigeria’s financial space safer, more transparent, and better regulated.
What’s next for Nigeria’s financial market?
The ISA 2025 is a major step forward, but its success depends on how well it is implemented.
The key questions are: Will the SEC enforce regulations fairly? Can crypto businesses thrive without excessive oversight? And will investors gain greater confidence in the market?
Bernard Parah, CEO of Bitnob, says, “Clearer regulation is a positive step. With this foundation in place, we can refine the framework as the industry evolves.”
The future now depends on balanced oversight, innovation-friendly policies, and a commitment to fostering trust.
Conclusion
In conclusion, the African giant financial system is growing, and the ISA 2025 is a big part of that growth. While it brings more rules, it also brings more trust, security, and opportunities for investors.
This law will have a direct impact on those involved in crypto, stocks, or other forms of investment. The key to success now lies in staying informed, adhering to regulations, and making informed investment decisions.
The future of Nigeria’s market is promising, provided that regulators, businesses, and investors collaborate effectively to ensure its success.
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