By Chinenye Anuforo
Nigeria, with 25.9 million active users and 11.9% penetration rate, currently tops Africa’s digital market of over 54 million users.
More so, Nigeria stands as a global leader, ranking first in stablecoin adoption and second in overall digital asset usage.
The rapid growth, largely driven by the need to hedge against naira volatility, access USD-denominated value and streamline cross-border transactions, is now catalysing regulatory formalisation.
These were highlighted in a comprehensive report featuring insights from digital asset platform, Yellow Card.
The report showed Africa’s key role in the global digital asset space. Beyond Nigeria’s leading position, nine other African nations have cemented their place among the top 50 global adopters, including Ethiopia, Morocco, Kenya, South Africa, Uganda, Algeria, Egypt, Ghana, and the Democratic Republic of the Congo, further illustrating the continent’s growing engagement with digital financial instruments.
The regulatory journey across Africa is characterized by a blend of established, developing, and nascent frameworks: Countries such as Botswana, Mauritius, Namibia, Nigeria, Seychelles, and South Africa have operational regulatory regimes. Botswana’s Virtual Assets Act, re-enacted in 2025, significantly strengthens compliance and investor safeguards.
Mauritius has seen its Financial Services Commission (FSC) issue six VASP licenses since the 2022 adoption of the VAITOS Act. In Namibia, the Virtual Assets Act (2023) introduced a comprehensive licensing regime, with provisional authorizations granted in early 2025. The Seychelles government’s 2024 Virtual Asset Service Providers Act outlines clear licensing criteria and substance requirements for VASPs.
Nations including Ethiopia, Ghana, Kenya, Morocco, Rwanda, Tanzania, Uganda, and Zambia are actively progressing towards formal regulation. Morocco is on track to introduce a comprehensive framework by the close of 2025. Ghana’s Bank of Ghana (BoG) released draft guidelines in August 2024 and has indicated readiness to begin regulating digital assets and VASPs by September 2025, planning a dedicated unit for this purpose.
While some jurisdictions like Algeria, Egypt, and Tunisia maintain effective bans on digital asset transactions, and countries such as the DRC and Malawi currently lack specific frameworks, the overarching trend suggests a continental move towards greater formalization and integration.
Nigeria’s regulatory advancements have been particularly swift, reflecting the country’s rapid adoption. Under the leadership of Dr. Emomotimi Agama, appointed SEC Director General in March 2024, the Securities and Exchange Commission (SEC) has accelerated its initiatives. The SEC launched an Accelerated Regulatory Incubation Program (ARIP) in June 2024 and, by August 2024, granted “approvals-in-principle” to two domestic digital asset exchanges while admitting five businesses into its Regulatory Incubation (RI) program.
A significant amendment to the Investments and Securities Act 2007, adopted on March 29, 2025, formally expands the SEC’s authority to regulate digital asset exchanges and operators. Furthermore, the Central Bank of Nigeria (CBN) is revisiting its earlier 2021 ban on crypto-related bank accounts, providing crucial clarity for financial institutions to engage with VASPs.
According to the report, in South Africa, the Financial Services Conduct Authority (FSCA) classified crypto assets as regulated financial products in October 2022. The implementation of the “Travel Rule” for digital asset transactions took effect on April 30, 2025, with simplified requirements for transactions below approximately US$275 (ZAR 5,000). As of December 2024, the FSCA had received 420 license applications from Crypto Asset Service Providers (CASPs), approving 248.
Despite the positive developments, challenges persist. Kenya’s 3.0% digital assets tax, which taxes transaction volume rather than profit, has raised concerns among VASPs about economic viability, although constructive dialogue for its refinement in the 2025 Finance Act is ongoing. The fragmented regulatory environment in regions like the Central African Economic and Monetary Community (CEMAC) also presents hurdles to a unified approach.
“As the development of digital asset regulatory frameworks progresses, thus providing market participants with greater clarity and ‘rules of engagement,’ we expect to see a continuing increase in digital asset adoption levels across the continent,” stated Craig Stoehr, Yellow Card’s General Counsel, and one of the authors of the Report.
“This is particularly the case given the legitimacy and focus on regulation of digital assets imparted by global developments, which we expect will have a ripple effect across Africa, leading to increased investment in the sector, ultimately resulting in greater financial inclusion and access, financial security, economic growth and prosperity.”
The report showed that the evolving frameworks, coupled with growing international collaboration and governmental support, indicate a promising and transformative future for digital assets in Africa.
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