Nigerian SEC implements stricter rules on crypto marketing

The Nigerian Securities and Exchange Commission (SEC) has introduced updated regulations for marketing crypto-related products, focusing on the role of virtual asset service providers (VASPs) and social media influencers.

The new rules, which will take effect on June 30, 2025, require VASPs to obtain prior approval from the SEC before engaging third-party service providers for promotions.

The SEC mandates that these third-party promoters comply with the commission's marketing guidelines.

In an effort to regulate the growing influence of financial influencers, or "Finfluencers," the SEC has specified that influencers must also obtain approval from the SEC before advertising digital asset products.

Additionally, Finfluencers are required to verify that the crypto companies they endorse are licensed by the SEC.

They must disclose any payments received for promotions, with penalties for non-compliance.

These penalties include fines of at least 10 million Nigerian naira (about $6,400) or imprisonment for up to three years.

The SEC emphasised that the new rules are aimed at curbing the influence of financial influencers and preventing the promotion of unregulated financial products through social media and other channels.

The agency plans to actively monitor crypto advertisements to ensure compliance with these updated guidelines.

Any violations will lead to enforcement actions, including sanctions and financial penalties.

The SEC's revisions come in the wake of growing concerns about unregulated crypto activities.

Currently, only two exchanges are regulated in Nigeria, which are Quidax Technologies and Busha Digital.

The SEC has made it clear that it will take enforcement actions against unlicensed businesses offering crypto services to Nigerian residents.