Nigeria is again in the spotlight of the global digital economy conversation, with a bold step toward regulating cryptocurrency and Point-of-Sale (POS) operations.
The House of Representatives has inaugurated an ad hoc committee to investigate these fast-growing financial innovations’ economic, regulatory, and security implications.
For a country ranked among the world’s top digital currency users, the move signals a new phase in the nation’s relationship with crypto.
The driving forces behind the regulatory push
The decision to regulate is not born out of a desire to stifle innovation but from a pressing need to address clear and present dangers that have emerged in the digital finance space.
The government’s concerns focus on three key areas: national security, consumer protection, and the financial system’s integrity.
1. Curbing financial crimes and terrorism financing
The top concern is the potential for cryptocurrencies to be used for illegal activities. Their anonymous and cross-border nature makes them attractive tools for criminals.
During the committee’s inauguration on Monday, the Speaker of the House, Abbas Tajudeen, cautioned against overlooking the risks associated with digital currencies.
“There are real concerns about cryptocurrency’s susceptibility to terrorism financing and money laundering, given its opaque nature, dubious regulatory framework, unclear governance structure, and lack of accountability,” he stated.
The committee plans to work closely with the Economic and Financial Crimes Commission (EFCC), the Nigerian Financial Intelligence Unit (NFIU), and the Independent Corrupt Practices Commission (ICPC).
The goal is to create a system to track transactions and report unwanted activities, preventing digital currencies from becoming a shadow channel for funding activities that threaten national security.
2. Protecting citizens from fraud and exploitation
The second major driver for regulation is the need to protect ordinary Nigerians from fraud and exploitation. The committee’s formation was triggered by “allegations of fraud, cybercrime, and consumer exploitation in the digital finance space.”
The POS sector, in particular, has been flagged for its vulnerabilities. With millions of small-scale operators across the country, many users transact without proper documentation.
This creates grounds for identity theft, unauthorised transactions, and other scams. The House of Representatives believes that enforcing proper user identification and registration for POS operators will reduce the incidence of such fraud.
Also, the crypto space has been riddled with high-profile scams and Ponzi schemes that have wiped out the savings of many inexperienced investors.
Rep. Olufemi Bamisile, the ad-hoc committee chairman, acknowledged this gap in consumer protection, stating frankly, “Let us be frank: many fintech entities in our country still lack robust protections for their customers.”
A clear regulatory framework would set standards for these companies and ensure they have measures to protect user funds and data.
3. Providing clarity and encouraging responsible innovation
The most positive reason for this regulatory push is to provide much-needed clarity and legitimacy to the industry.
Over the years, operators in the crypto space have worked in a grey area, unsure of their legal standing. This uncertainty discourages serious long-term investment and innovation.
The government now recognises that digital currencies are here to stay and that Nigeria, with its young, tech-savvy population, cannot afford to be left behind.
Speaker Tajudeen acknowledged the strength of the Nigerian economy and concluded, “It is safe to conclude that the cryptocurrency trade will thrive in such a robust economic environment.”
The aim is not to kill the industry but to nurture it responsibly. As Rep. Bamisile put it, “We are not here to stifle innovation, but innovation without safeguards can destabilise economies, empower criminals, and erode public trust.”
He said the committee’s focus “will be on developing a legislative and regulatory framework that encourages innovation while protecting citizens and the integrity of the nation’s financial system.”
Nigeria’s evolving cryptocurrency policy
Nigeria’s path to regulating cryptocurrency has been long and complex. In 2021, the Central Bank of Nigeria banned banks from processing crypto-related transactions, citing fears of money laundering and terrorism financing.
That decision drove most crypto activities underground or onto peer-to-peer (P2P) platforms, beyond regulatory oversight.
However, by 2023, the CBN began to change its tone, lifting restrictions and issuing guidelines for Virtual Asset Service Providers (VASPs) to operate legally.
This shift reflected a growing realisation that crypto could not simply be ignored. The digital asset market was booming, and Nigerians were leading the charge.
A Chainalysis report ranked Nigeria 6th globally in crypto adoption, with users transacting $92.1 billion in value between July 2024 and June 2025, nearly half of Sub-Saharan Africa’s total.
In March 2025, President Tinubu signed the Investments and Securities Act (ISA) 2025, officially classifying digital assets as securities under the SEC’s oversight.
This law provided long-awaited legal clarity, giving regulators the tools to oversee crypto activities, exchanges, and custodians in line with global standards.
Nigeria’s young, tech-savvy population also embraces crypto as a tool for financial empowerment, remittances, and savings amid inflation and currency devaluation. But without oversight, these opportunities could easily turn into risks.
The newly formed ad hoc committee is expected to hold public hearings nationwide, gathering feedback from key stakeholders before drafting the proposed legislation.
Its findings will likely shape how they integrate crypto into the national financial system to balance innovation, security, and consumer protection.