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The Stakeholders in Blockchain Association of Nigeria (SiBAN) has officially called on the Securities and Exchange Commission (SEC) to review its recently hiked minimum capital requirements for virtual asset service providers, warning that the new ₦2 billion ($1.4 million) threshold could stifle local innovation.
In a position paper submitted to the regulator, the advocacy group which represents prominent local startups including Roqqu, Dantown, and Breet described the new financial bar as a “disproportionate burden” on early-stage companies. The group argues that while regulatory oversight is necessary, the current blanket requirement risks creating a market monopoly for well-funded foreign exchanges and established incumbents.
Under the revised framework introduced by the SEC on January 16, Digital Asset Exchanges (DAXs) and custodians saw their capital requirements leap from ₦500 million to ₦2 billion. SEC Director General Dr. Emomotimi Agama has previously defended the move, stating it is essential to ensure firms have adequate financial buffers to protect investors and maintain market integrity.
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However, SiBAN President Barr. Mela Claude Ake maintains that a “one-size-fits-all” approach is counterproductive. Instead, the association is proposing a tiered regulatory model designed to accommodate the industry’s lifecycle:
Innovation Track: A ₦50 million to ₦200 million bracket for startups and pilot-stage platforms.
Growth Track: A ₦200 million to ₦500 million requirement for expanding operators.
Institutional Track: A ₦500 million-plus requirement for established, high-volume platforms.
“We respectfully submit that the current framework requires refinement to balance regulatory rigor with innovation sustainability,” the group stated.
Beyond the financial figures, SiBAN is seeking an extension of the compliance deadline to 2028, a significant jump from the current June 2027 cutoff. They are also advocating for the creation of a “Digital Asset Regulatory Working Group” involving the SEC, the Central Bank of Nigeria (CBN), and NITDA to ensure policy remains adaptive to the fast-moving tech landscape.
To help smaller players survive, the paper suggests alternative pathways such as mergers and acquisitions, white-label arrangements, and “regulatory cover” through incubator partnerships.
The SEC now faces a delicate balancing act: enforcing the strict financial safeguards it deems necessary for a stable economy while ensuring that Nigeria’s homegrown crypto ecosystem, one of the most active in the world, is not regulated out of existence.
