The Nigerian Securities and Exchange Commission recently drafted an amendment to a law regulating the crypto industry in Nigeria.
The new law requires every crypto platform or Virtual Assets Service Provider (VASP) to be registered with a license from the Nigerian SEC before carrying out any promotion on social media, TV, or Print.
According to the new law, crypto influencers must also disclose to their community that they are paid to promote a digital asset or a service. Failure to do this could attract a fine of N10 million naira and up to 3 years in jail.
Rume Ophi, leading crypto analyst and educator in Nigeria shared his thoughts on the new law. Rume stated that the policy, although imperfect, is a step in the right direction.
“The Policy is not perfect, according to documents is going to take full force from June 2025. It makes a whole lot of sense to start right now because before now we have had a lot of bad actors and players in the industry who don’t want anything regulated so they can also promote projects that have led people to lose their money.
It is a step in the right direction people can only promote projects that have licenses. This will shut the door for people who are experts in promoting terrible projects.
Every technology has bad actors and the crypto industry is not immune to it. There needs to be some level of structure and that is what a law like this is meant to do” Rume stated
The new law by the SEC was welcomed by top stakeholders in the Nigerian crypto space as a positive step in sanitizing the Nigerian crypto space and getting rid of predatory practices by bad actors.
The New SEC LAW in Bits
- The Category containing the law for the influencers in the official document from the Nigerian SEC was titled Specific Requirements for Third-Party and Social Media Promotions.
- It was split into three subcategories with each category addressing a particular issue.
- The first subcategory titled “Third Party Engagements” stipulated that every VASP intending to engage a third party for promotions must get subsequent approval from the Nigerian SEC.
- The VASP also needs to ensure that the third party adheres to the SEC rules on crypto promotion.
- The Second subcategory titled “Social media influencers “stipulates that any VASP engaging the services of an influencer to promote a platform or a token must obtain a “No objection authorization” from the commission before engagement.
- Fin influencers should before accept a gig make sure that the VASP or platform they are about to promote has obtained a license from the SEC.
The last subcategory titled “Disclosure of paid promotions “stipulates that Fin influencers should always disclose to their community whenever they are paid to promote a token or a platform.
