This August, Chainalysis hosted a landmark webinar with the Securities and Exchange Commission (SEC) Nigeria, bringing together regulatory leaders and blockchain intelligence experts to address the challenges and opportunities in Africa’s largest cryptocurrency market.
With Nigeria ranking second globally in cryptocurrency adoption (trailing only India), the conversation highlighted how blockchain intelligence and regulatory frameworks can work together to combat fraud while fostering legitimate innovation. The insights shared during this session offer valuable lessons not just for Nigeria, but for emerging markets worldwide.
Key takeaways
1. Nigeria’s cryptocurrency adoption presents unique challenges and opportunities
Dr. Emomotimi Agama, Director General of SEC Nigeria, presented a sobering assessment of the current landscape: “This is not a fad. The statistics don’t lie. With over 33% of our 220+ million population engaged in the digital asset space — most under 30 years old — we must take this as seriously as the opportunity it represents.”
The scale of adoption creates both enormous economic potential and significant risks. With approximately 70% of Nigeria’s population under 30 years old, the digital-native generation is embracing cryptocurrency at unprecedented rates, driving innovation but also creating vulnerabilities that scammers eagerly exploit.
2. The cost of inaction: Devastating financial losses to scams
Perhaps the most alarming revelation came from SEC Nigeria’s investigation team: Nigerians have lost an estimated 1 trillion naira to crypto-related Ponzi schemes over the past 25 years, with a staggering 1.3 trillion naira disappearing in the Cybeg saga earlier this year alone.
Saad Abdulsalam from SEC Nigeria emphasized the human impact, stating, “These staggering losses have shattered dreams of so many families by sending people to hospitals. Some have even gone to early graves.”
The SEC Nigeria is currently investigating 79 suspected Ponzi schemes, highlighting the industrial scale of the fraud challenge.
3. Regulatory clarity through the Investment and Securities Act (ISA) 2025
Commissioner Bola Ajomale detailed how Nigeria’s regulatory response has evolved through the recently enacted Investment and Securities Act (ISA) 2025: “This new act is our first upgrade in 18 years. The world eighteen years ago is totally different from the world we have now, especially in terms of technology and how markets have moved.”
The ISA 2025 provides critical foundations for the crypto ecosystem by:
- explicitly defining crypto assets within securities law;
- placing licensing of Virtual Asset Service Providers under SEC supervision;
- setting mandatory standards for custody and asset segregation;
- introducing criminal penalties for Ponzi scheme operators and their promoters;
- and requiring comprehensive disclosures for digital asset offerings.
This framework positions SEC Nigeria as the central coordinator for crypto regulation while acknowledging the roles of other agencies like the Central Bank of Nigeria for payment system aspects.
4. Blockchain analytics: Following the money across chains
Zakaria Ellaoui, Senior Solutions Architect at Chainalysis, demonstrated how blockchain intelligence tools helped trace the CBEC scam that defrauded Nigerians of over $300 million in USDT, “We have identified over 300,000,000 USDT that were deposited from Nigerian victims. The funds are then moved to a bridge, and then we have an off-ramp stage where the platform allowed strategic withdrawals through multiple exchanges to obscure that trail.”
Chainalysis has identified over 100,000 unique entities on the blockchain and helped seize more than $11 billion in assets from criminals globally. The presentation highlighted how even sophisticated attempts at obfuscation through blockchain bridges can be tracked using advanced analytics.
5. Multi-agency collaboration is essential
Abdulrasheed Dan-Abu, Head of Fintech and Innovation at SEC Nigeria, outlined the comprehensive collaboration framework Nigeria is building to address cryptocurrency risks, stating, “Not one institution can do this alone. Everyone that has one relationship or the other to these platforms must certainly come together in order for us to build a strong relationship and protect ourselves from the usual arbitrage.”
This framework brings together:
- The Securities and Exchange Commission (SEC)
- Central Bank of Nigeria
- Nigerian Financial Intelligence Unit
- Economic and Financial Crimes Commission
- Nigerian Police Force
- Department of State Services
- Office of National Security Adviser
The speakers emphasized that this multi-stakeholder approach is critical to addressing the cross-border nature of cryptocurrency fraud.
Looking ahead: Building a safer ecosystem
The webinar concluded with a clear vision for the future of Nigeria’s cryptocurrency ecosystem. Commissioner Ajomale emphasized that regulation is not meant to stifle innovation but rather to enable it through increased trust: “We’re actually regulating in order to help investors build more trust, to distinguish those that we recognize from those with a higher possibility of making off with their money. I used to run an exchange, so I do recognize the importance of innovation.”
This approach — combining regulatory clarity, advanced blockchain analytics, and multi-agency collaboration — could serve as a model for other high-adoption markets facing similar challenges.
As Nigeria continues to lead Africa in cryptocurrency adoption, the collaboration between Chainalysis and SEC Nigeria represents an important step toward creating a more secure and transparent ecosystem. By leveraging blockchain’s inherent transparency through advanced analytics and combining it with progressive regulatory frameworks, Nigeria is working to balance innovation with investor protection.
For cryptocurrency businesses operating in Nigeria and other emerging markets, this signals a shift toward greater accountability and compliance requirements — but also the potential for more sustainable growth in a fraud-resistant environment.
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