The Central Bank of Nigeria (CBN) is stepping up oversight of the country’s fast-growing virtual asset space, launching a pilot programme focused on anti-money laundering and financial crime compliance among selected industry players.
In a directive issued on March 31, the apex bank announced the commencement of an Anti-Money Laundering, Counter-Financing of Terrorism, and Counter-Proliferation Financing (AML/CFT/CPF) supervision pilot. The initiative, it said, is part of a broader risk-based supervisory approach aimed at strengthening financial system stability and improving oversight of virtual asset activities within its remit.
The CBN was clear that the pilot does not replace or override existing regulations, nor does it diminish the role of other regulators overseeing digital assets in Nigeria.
A number of prominent fintech and crypto-adjacent firms have been selected for the exercise, including cNGN, Flutterwave, Juicyway, KoinKoin, KuCoin, and Paystack. These companies will serve as the first cohort in what is expected to shape future regulatory engagement with Virtual Asset Service Providers (VASPs).
Nigeria remains one of the most active cryptocurrency markets globally. Data from Chainalysis shows that Nigerians transacted an estimated $92.1 billion in crypto between July 2024 and June 2025 nearly three times the volume recorded in South Africa, the next largest market on the continent.
Regulatory clarity around digital assets has been evolving. The Investment and Securities Act (ISA) 2025 formally designated the Securities and Exchange Commission (SEC) as the primary regulator for digital assets. More recently, the government outlined plans for a coordinated oversight framework through a White Paper issued by the Virtual Asset Regulatory Authority (VARA), introducing institutions such as the Virtual Asset Regulatory Council (VARC) and the Virtual Asset Regulatory Office (VARO).
Under this model, regulatory responsibilities are shared across agencies, including the CBN and the Nigeria Revenue Service (NRS), reflecting a more collaborative approach to governance in the sector.
According to the CBN, the pilot will give regulators deeper insight into the risks, business models, and operational structures of participating firms. It is also designed to push compliance with global standards, particularly those set by the Financial Action Task Force (FATF), including the “Travel Rule,” which mandates the sharing of transaction data between financial institutions.
Nigeria’s recent removal from the FATF grey list in October 2025 adds context to the move. The country had been listed since February 2023, with its exit tied to improvements in anti-money laundering controls and financial transparency.
As part of the pilot, participating firms will submit monthly compliance reports, engage directly with regulators, and undergo reviews covering governance, customer onboarding, sanctions screening, transaction monitoring, and cross-border operations. They are also expected to demonstrate clear implementation plans for key FATF requirements.
The involvement of the Nigeria Financial Intelligence Unit (NFIU) in aspects of the programme underscores the authorities’ focus on enforcement and intelligence-led supervision.
The CBN emphasised that participation in the pilot is strictly for supervisory purposes and does not grant any form of licensing, approval, or regulatory status to the companies involved.