Nigeria’s CBN opens regulatory sandbox to cryptocurrency operators
The Central Bank of Nigeria (CBN) has begun admitting cryptocurrency operators into a regulatory sandbox, according to TechCabal, in a move that signals a further easing of the bank’s posture toward the country’s digital assets sector.
Nigeria has long ranked among the most active cryptocurrency markets in Africa, with peer-to-peer trading surging after the CBN in 2021 ordered deposit money banks to close accounts belonging to crypto exchanges and other virtual asset service providers. That directive did not criminalise individual ownership of digital assets, but it cut off a key channel through which exchanges moved money in and out of the local currency, pushing much of the trade onto informal peer-to-peer platforms.
In the years since, the central bank has shifted course. It launched the eNaira, a central bank digital currency, in late 2021, and senior officials have publicly acknowledged the need for clearer rules covering private digital assets. The Securities and Exchange Commission has meanwhile moved separately to bring digital asset platforms under its own licensing framework, creating overlapping but distinct tracks for fintech regulation in Africa’s largest economy.
What a sandbox allows
Regulatory sandboxes are supervised testing environments in which firms can launch products under close oversight. The rules are relaxed enough to encourage experimentation but tight enough to allow regulators to intervene quickly if something goes wrong. They have been adopted by financial authorities from London to Singapore as a way of engaging with fast-moving financial technology without conceding the field to unregulated operators.
By bringing crypto firms inside a sandbox, the CBN is taking a more direct hand in shaping how virtual asset businesses operate in Nigeria. As TechCabal reported, the step indicates that the central bank now intends to set the terms on which the industry grows rather than continue to push it outside the formal banking system.
Sources
This report was written from coverage published by the following news organisations. Follow the links for the original reporting.
