An Official Communication from the Virtual Asset Service Providers Association (VASPA).
The Virtual Asset Service Providers Association (VASPA), an Africa-focused advocacy group, is pleased to announce the submission of a comprehensive policy advisory report, “Virtual Assets in Nigeria: Policy Advisory Report and Recommendations for the EFCC,” to the Economic and Financial Crimes Commission (EFCC) in September 2025. Prepared in collaboration with the Blockchain Industry Coordinating Committee of Nigeria (BICCoN), this report serves as a foundational blueprint for integrating Nigeria’s burgeoning virtual asset industry into a robust, secure, and globally compliant financial system.
This submission is a testament to VASPA’s commitment to responsible innovation and demonstrates the industry’s dedication to partnering with law enforcement and regulatory agencies. The advisory balances the immense economic potential of the virtual asset sector with the non-negotiable imperative of financial crime prevention, positioning the industry as a vital engine for national economic advancement.
Key Themes and Recommendations for a Secure Digital Economy
The report acknowledges that Nigeria is a global leader in virtual asset adoption, driven largely by a young, tech-savvy population using these assets, particularly stablecoins, as a critical tool for economic participation and protection against macroeconomic challenges. The recommendations laid out across six key areas are designed to create a clear, coordinated, and technologically-enabled framework for managed oversight, moving past prohibitory stances.
1. Recognizing and Harnessing Economic Value
The report provides empirical data confirming that virtual assets are now a significant and pervasive component of the national financial landscape. Rather than being a fringe activity, the high volume of retail transactions shows mass adoption. VASPA recommends that policy must actively harness this economic potential, treating the industry as a generator of jobs, revenue (through registration and taxes), and foreign direct investment, not solely as a threat.
2. Defining a Cohesive Regulatory Framework
The advisory supports the recent regulatory shift toward managed oversight, leveraging the expertise of Nigeria’s existing agencies. Key recommendations include:
- Designated Lead Regulator: Formalizing the Securities and Exchange Commission (SEC) as the primary regulator for investment-related virtual assets, with the Central Bank of Nigeria (CBN) retaining authority over payment and monetary policy aspects.
- Inter-Agency Collaboration: Establishing a formal, multi-agency framework to ensure seamless information sharing and coordination between the SEC, CBN, NFIU, and EFCC, eliminating regulatory friction and providing clear guidance to the industry.
3. Modernizing the Legal Mandate for Enforcement
To effectively combat digital-era financial crime, the legal framework must be modernized. The report calls for legislative amendments to:
- Address Crypto-Native Crimes: Updating existing laws, like the Cybercrimes Act, to specifically criminalize unique virtual asset offenses, such as smart contract exploits and unauthorized wallet access/theft.
- Empower Law Enforcement: Providing law enforcement with the clear legal backing and modern tools necessary to investigate complex on-chain crimes, including explicit asset freezing and seizure powers.
4. Implementing Risk-Based Transaction Reporting
To comply with global FATF standards (like the “Travel Rule”) without stifling legitimate activity, the report recommends:
- A Risk-Based Approach: Prioritizing the monitoring and reporting of high-risk transactions (e.g., transfers to sanctioned entities or known mixers) over broad, indiscriminate thresholds that complicate compliance for legitimate businesses.
- Leveraging Technology: Investing in advanced blockchain analytics tools to trace funds across decentralized platforms (DeFi and P2P), ensuring that law enforcement can track the full flow of funds regardless of the platform used.
5. Addressing Capital Flight with Transparency
The report contextualizes the use of virtual assets in capital flight as a symptom of broader economic instability. Instead of prohibition, the solution lies in leveraging the technology’s inherent transparency:
- Focus on Root Causes: Addressing the macroeconomic drivers that lead agents to seek stable alternatives.
- Technological Deterrence: Deploying blockchain analytics and specialized “RegTech” tools to monitor transaction patterns, identify anomalies, and facilitate the recovery of illicitly moved assets. The blockchain’s permanent record is a powerful tool against financial crime.
6. The Imperative of Self-Regulation and Public-Private Collaboration
A core advocacy position of the report is the need for formal industry partnership. The report recommends:
- Formal Recognition of SROs: Recognizing and supporting Self-Regulatory Organizations (SROs) like VASPA and BICCoN as a vital complement to government oversight. SROs offer the technical expertise and flexibility required to rapidly adapt industry-specific rules and enforce ethical conduct.
- Structured Partnership: Formalizing collaboration with the EFCC through a Memorandum of Understanding (MoU) for shared intelligence on crime typologies, joint capacity building, and policy advisory.
- Promoting Trust: Endorsing initiatives like VASPA’s ZERO CRIME badge, which signals a VASP’s commitment to robust compliance, helping the EFCC to prioritize its enforcement efforts toward non-compliant actors.
In conclusion, VASPA’s policy advisory serves as a strategic roadmap for creating a transparent, secure, and business-friendly virtual asset ecosystem. It reinforces our role as the bridge between innovation and sound governance, ensuring Nigeria can confidently lead the way in the global digital economy. The report is part of what is expected to be an ongoing engagement with the EFCC and other relevant stakeholders.
The full report is only available to registered members of VASPA.
The Virtual Asset Service Providers Association (VASPA) is an Africa-focused advocacy group committed to fostering a trusted and secure virtual asset ecosystem through the promotion of responsible innovation, policy, and regulation.
Email: info@vaspa.org; copy adminsec@vaspa.org
Vice Chair (Programs & Communications): Buki Ogunsakin (vicechairpc@vaspa.org)
Executive Chair: Senator Ihenyen (executivechair@vaspa.org)
