Senate Approves Bill to Regulate Cryptocurrency and Protect Investors

A bill aimed at regulating cryptocurrency, protecting investors and strengthening Nigeria’s digital economy has passed its second reading in the Senate. The measure, which was sponsored by Deputy Senate President Barau Jibrin, was presented on the floor by Senate Chief Whip Tahir Monguno and cleared by voice vote during Tuesday’s plenary after receiving majority support from lawmakers.

Following the debate, the bill was referred to the Senate Committee on Capital Market for further legislative work, including a public hearing. The committee was given four weeks to submit its report. The proposed law seeks to create a comprehensive regulatory and supervisory framework for virtual assets, digital assets and Virtual Asset Service Providers (VASPs) operating in Nigeria.

It also introduces mandatory licensing, transparency and compliance requirements for cryptocurrency exchanges and related businesses. Supporters of the bill argued that Nigeria, despite being one of the biggest cryptocurrency markets in Africa, has lagged behind several peer countries in setting clear rules for the sector. They said the absence of a strong legal framework has left investors vulnerable to fraud, market manipulation, cybercrime and the failure of unregistered digital investment platforms.

During the debate, Monguno said the bill responds to the changing realities of the global financial system, where technology is reshaping how people earn, trade, save and invest. He noted that millions of young Nigerians are already active in the digital economy, building fintech platforms, trading assets and using blockchain technology for innovation. He said Nigeria ranks among the leading users of virtual assets worldwide.

Lawmakers backing the bill said the fast growth of cryptocurrency use in Nigeria has taken place largely without proper oversight, creating opportunities for scams, Ponzi schemes and fraudulent exchanges. They also warned that the lack of regulation has increased concerns about money laundering, terrorism financing and other illicit activities that can be enabled by anonymous digital transactions.

Senator Oyelola Ashiru of Kwara South questioned why Nigeria had been slow to embrace virtual assets while countries such as Kenya, South Africa and Ghana had already advanced their digital finance frameworks. Senator Adetokunbo Abiru of Lagos East supported the bill but urged lawmakers to ensure it aligns with existing financial sector laws, saying a coordinated approach would be better for the industry.

Senator Shuaib Salisu of Ogun Central said Nigeria must regulate the sector to prevent it from becoming a black market space where opaque transactions could fuel criminal activity. Senator Adams Oshiomhole of Edo North also backed the bill, describing the arguments in its favor as persuasive.

If the bill is eventually passed by the National Assembly and signed by President Bola Tinubu, it could significantly reshape Nigeria’s approach to digital assets. Proponents say it would improve investor confidence, attract local and foreign investment, support innovation in blockchain and fintech, strengthen oversight and help government agencies track transactions more effectively. It could also boost tax revenues from the fast-growing digital asset market while reducing risks linked to fraud and illegal financial flows.