The Director General of the Security and Exchange Commission (SEC), Emomotimi Agama, revealed that Nigeria’s cryptocurrency market is valued at over $400 million.

Agama spoke at the 2024 Annual Conference of the Association of Capital Market Academics of Nigeria (ACMAN) in Abuja, themed ‘Crypto Assets and the Nigerian Economy: Implications for Financial Markets Regulation’.

According to Agama, a substantial portion of the Nigerian population engages in cryptocurrency trading and transactions. He predicts the market volume will reach $52.5 million in 2028, representing a 12.66% increase between 2024 and 2028.

This growth indicates Nigeria’s position as a leading country in crypto adoption and transaction volume. The SEC DG highlights opportunities for financial services and remittance solutions but also notes challenges like regulatory uncertainty, security concerns, and financial literacy. He advocates for balanced regulation to harness benefits while mitigating risks.

According to Agama, despite economic challenges, the country has emerged as one of the leading countries globally in terms of crypto adoption and volume of transactions.

He said, “Reports indicate that Nigeria’s crypto transaction volume reached $56.7 billion between July 2022 and June 2023, representing a nine percent year-over-year growth.

“The country’s crypto market is estimated to be worth over $400 million, with a significant portion of the population involved in cryptocurrency trading and transactions.”

While disclosing that approximately 33.4% of Nigerians own or use cryptocurrencies, the Director General said the country can take advantage of the large number to further provide financial services for the over 38 million unbanked adults. According to him, some people don’t have bank accounts but they have wallets.

He added that cryptocurrencies can also provide cheaper and more efficient methods of remittance for Nigerians in diaspora.

“Cryptocurrencies can significantly reduce remittance costs, with Bitcoin transactions cutting fees by up to 50%. Nigeria is one of the largest recipients of remittances in Africa. Cryptocurrencies offer a more efficient and cost-effective way for Nigerians abroad to send money home. With traditional remittance fees often being prohibitively high, cryptocurrencies provide a cheaper and faster alternative,” he said.

He, however, noted that despite the numerous advantages, challenges persist. He pointed out concerns over illicit activities, as highlighted by Nigeria’s Economic and Financial Crimes Commission (EFCC), which has reported cases of crypto-related scams.

According to the SEC DG, regulatory uncertainty, security concerns and financial literacy pose a serious threat to crypto use.

“The lack of a comprehensive regulatory framework has created uncertainty, which can deter both investors and innovators. Cybersecurity threats, including hacking and fraud, pose significant risks. A substantial portion of the population lacks adequate financial literacy, making them vulnerable to scams and risky investments,” he explained.

He asserted that Crypto assets present significant opportunities and challenges for Nigeria’s economy noting that a balanced regulatory approach is essential to harness their benefits while mitigating risks.

“Collaborative efforts from regulators, industry stakeholders, and the public are crucial for developing effective regulations. I encourage continued dialogue and cooperation to ensure a secure and innovative financial ecosystem,” he said.

In his remarks, Chairman of the Securities and Exchange Commission, Mr. Mairiga Katuka said the introduction of crypto presents an advantage for the markets and urged all to chart a course forward for Nigeria with its vibrant financial markets.

“Together we can drive the development of a vibrant resilient capital market in line with President Bola Tinubu’s dream on making Nigeria a prime investor destination.

“Let us work together to build a capital market that does not only see The needs of today but also anticipates the problems of tommorrow with view to finding solutions before the issues arise” he added.