Nigeria Senate advances licensing bill for crypto exchanges

Nigeria's Senate on Tuesday advanced a bill that would put crypto exchanges under formal licensing rules for the first time. The Virtual Asset Service Providers Regulation Bill, 2026, passed second reading and now moves to committee review.

The proposal, sponsored by Deputy Senate President Barau Jibrin and presented by Senate Chief Whip Mohammed Monguno, aims to create a legal framework for virtual asset operators. It would require exchanges and blockchain-based investment platforms to obtain licenses and follow anti-money laundering rules tied to Financial Action Task Force standards. Lawmakers said the measures target fraud and bring order to a market that currently operates in a regulatory grey zone.

Senate Whip Tahir Monguno said Nigeria trails several African peers on virtual asset laws, pointing to Kenya, South Africa, and Ghana as countries with more developed frameworks. The sponsor framed the bill as a tool to promote confidence and consumer protection without blocking innovation.

Nigeria is one of the world's most active crypto markets by adoption. Users rely on digital assets for remittances and cross-border payments, plus hedging against inflation. The country's crypto policy has shifted over the years. Banks once faced restrictions on servicing crypto firms. Regulators later opened registration pathways for digital asset providers. The new bill seeks to consolidate scattered rules into a single legal structure. Lawmakers linked the proposal to President Bola Tinubu's $1 trillion economy target, arguing that unregulated crypto activity limits the digital economy's official contribution.

The bill's passage through second reading does not make it law. It still needs committee review and a third reading before reaching the president. The Senate Committee on Capital Market will examine the proposal, consider amendments, and invite public input. No date has been set for the next stage.

If passed, the bill would increase compliance costs for exchanges and other operators. Supporters argue that clear rules could help legitimate firms attract investment. The committee review will determine the final shape of licensing and compliance requirements.

Nigeria's role as a major crypto adoption market gives the bill weight beyond its borders. Changes to how local exchanges operate could shift trading volumes and user behavior across West Africa. The committee timeline remains open.