Abuja FCT, Nigeria — On March 31, 2026, the Central Bank of Nigeria (CBN) issued a press release announcing the commencement of an Anti-Money Laundering, Counter-Financing of Terrorism, and Counter-Proliferation Financing (AML/CFT/CPF) Supervision Pilot for a select group of Virtual Asset Service Providers (VASPs).
VASPA has reviewed the CBN’s communication. Below is a comprehensive breakdown of the regulatory update, followed by our official position on the development.
The CBN has initiated this pilot as part of its risk-based supervisory program to strengthen financial system stability and market integrity oversight within its mandate, aligning with the Money Laundering (Prevention and Prohibition) Act 2022, the CBN Act, and BOFIA 2020.
During the pilot, the selected entities are required to:
The CBN has identified the following entities for the initial supervisory phase:
The CBN has stated that the pilot is structured in multiple phases. However, subsequent phases are already fully scheduled and are not open to external expressions of interest.
The CBN explicitly clarified that participation in this pilot is strictly supervisory. It does not confer any regulatory status, approval, licensing right, or authorization on the participating entities.
Furthermore, the CBN assured that all submitted data will be treated as confidential supervisory information in accordance with the Nigeria Data Protection Act 2023. Notably, this pilot also does not replace existing regulatory frameworks or the mandates of other competent authorities governing virtual assets in Nigeria.
(For direct CBN enquiries regarding this pilot, the designated contact is cmd.financialcrime@cbn.gov.ng).
As a virtual asset industry association, VASPA welcomes the CBN’s proactive steps to understand our sector and align domestic operations with global FATF standards. Constructive engagement between regulators and operators is essential for a secure, innovative, and compliant digital economy.
However, evaluating this development against global best practices reveals several areas of concern and opportunities for improvement.
We note with significant concern that there was no public invitation or open application process for this pilot. The participating platforms were unilaterally selected by the CBN, and it has been explicitly stated that subsequent cohorts are also locked and closed to external expressions of interest.
Global best practices—such as those modeled by the UK’s Financial Conduct Authority (FCA) Regulatory Sandbox or the Monetary Authority of Singapore (MAS)—rely on transparent, criteria-based, and open application processes. By “handpicking” participants and closing the door to voluntary expressions of interest, the CBN risks creating an uneven playing field. While we recognize the practicalities of a controlled initial cohort, adopting a more inclusive selection methodology for future phases would greatly enhance market-wide engagement. Providing a pathway for emerging innovators to voluntarily apply allows a broader range of compliance-focused operators to align with the CBN’s regulatory objectives. Furthermore, mitigating any unintended perceptions of exclusivity will only strengthen the pilot’s credibility. We respectfully suggest that a transparent, open-call framework would yield a richer, more representative understanding of the diverse business models operating within Nigeria’s VASP ecosystem.
Ultimately, an open process not only reinforces public trust in the regulatory journey but also amplifies the confidence and pride of the entities that successfully qualify for this significant milestone.
The inclusion of Flutterwave and Paystack in a “VASP” pilot is highly notable. While they are premier Payment Service Providers (PSPs) and payment gateways, they are not strictly Virtual Asset Service Providers under standard definitions.
VASPA believes that Flutterwave’s and Paystack’s inclusion is a strategic move by the CBN to monitor the crucial intersection between the traditional financial system and the virtual asset ecosystem. Fiat on-ramps and off-ramps are the primary choke points for capital flowing into and out of crypto markets. By bringing the largest payment processors into this pilot, the CBN is likely aiming to:
Notably, apart from the fact that both PSPs were also included in Nigeria’s National Blockchain Policy in 2023, both PSPs have also recently announced their involvement in stablecoin-related partnerships.
VASPA extends its sincere congratulations to the selected entities on their participation in the Central Bank’s inaugural AML/CFT/CPF Supervision Pilot.
As the pioneers entering this structured supervisory environment, these entities carry a unique and vital responsibility. Engagement with the CBN—particularly concerning the implementation of FATF Recommendations 15 and 16, Travel Rule preparedness, and cross-border activity monitoring—will undoubtedly set precedents that will likely shape the future regulatory landscape for all digital asset operators in Nigeria.
While VASPA continues to advocate for an open, transparent regulatory framework that allows all compliant operators a pathway to engagement, we recognize the heavy lifting these entities will undertake during this pilot. We see the compliance frameworks these entities will demonstrate and the insights they provide playing a crucial role in bridging the gap between technological innovation and financial system stability in our country.
We wish the selected entities a constructive, productive, and successful engagement with the CBN and the NFIU over the coming months. VASPA stands ready to support these entities as industry peers, and we look forward to the positive impact their participation will ultimately have on the broader Nigerian virtual asset ecosystem.
To high-performing VASPs not included in this initial cohort, we urge you to stay the course. Evolving alongside Nigeria’s regulatory framework requires patience and strategic positioning. Continue to champion global AML/CFT standards and proactively strengthen your compliance frameworks. Your ongoing commitment to these best practices will be your greatest advantage as Nigeria’s regulatory landscape matures.
By the way, VASPs can leverage VASPA’s inclusion as an SRO by the Nigeria Financial Intelligence Unit (NFIU) to contribute to the National Risk Assessment (NRA) on virtual assets in Nigeria. For more information about this, please click here. By working collaboratively, we believe that we can make this count for you and the industry.
VASPA remains fully dedicated to advocating for broader market inclusion and supporting your journey toward full regulatory readiness, ensuring that when the door opens wider, your business is fully prepared and supported to step through.
While we commend the CBN’s intent to fortify market integrity, VASPA urges the CBN to transition from a closed-door selection process to a transparent, inclusive approach. We will be reaching out to the CBN on behalf of our wider membership to advocate for a more inclusive pathway for all compliant operators who wish to actively participate in strengthening Nigeria’s digital asset framework.
We will continue to monitor the situation and keep the industry and all stakeholders updated on any further engagements with the regulators.
The Virtual Asset Service Providers Association (VASPA) is a Pan-African industry body registered as an Incorporated Trustee with the Corporate Affairs Commission in Nigeria (CAC IT: 79069970) where it is headquartered. VASPA comprises individual, corporate, and institutional members from across Africa. For more information about us, please visit our website, www.vaspa.org. To become a Patron or Partner of VASPA, visit our Membership page: https://vaspa.org/become-a-member/. Individual and corporate members are also welcomed.
Abuja FCT, Nigeria — In a definitive nod to its growing authority and crucial coordinating role within the virtual asset sector, the Virtual Asset Service Providers Association (VASPA) has been officially enlisted by the Nigerian government to be a part of the Virtual Assets Working Group to help steer the country’s ongoing National Risk Assessment (NRA).
Abuja FCT, Nigeria — In a definitive nod to its growing authority and crucial coordinating role within the virtual asset sector, the Virtual Asset Service Providers Association (VASPA) has been officially enlisted by the Nigerian government to be a part of the Virtual Assets Working Group to help steer the country’s ongoing National Risk Assessment (NRA).
Founded in 2024, the Virtual Asset Service Providers Association (VASPA) is a Pan-African industry body registered as an Incorporated Trustee with the Corporate Affairs Commission in Nigeria (CAC IT: 79069970), comprising individual, corporate, and institutional members from across Africa. Join us to shape the future of virtual asset in Africa.
