Nigeria’s Securities and Exchange Commission (SEC) has implemented stricter rules targeting influencers promoting crypto-related products without transparency.
Under the updated framework, influencers must ensure that their crypto clients are licensed by the SEC before endorsing a product or service.
Additionally, all promotional content should be clearly labeled as sponsored. Failure to comply with these rules will result in heavy penalties, including a fine of at least 10 million naira (about $7,000) and imprisonment of up to three years, or both.
Influencers should also use simple language in their promotions. The SEC warns against using technical jargon, ambiguous terms, or exaggerated promises such as “double your income now” or “secure your future.”
The SEC added that promotional materials must avoid claims that could mislead or confuse potential investors. In addition, all advertising must receive prior approval from the Commission before its publication.
The Commission explained that the move responds to growing concerns about financial influencers promoting unauthorized investments in digital assets. The regulations cover all communication platforms, including social media, television, radio and USSD channels.
The SEC said it will actively monitor online promotions and prosecute violators who violate these guidelines.
The decision of the Nigerian SEC notably aligns with global trends. For example, the UK’s Financial Conduct Authority (FCA) introduced similar measures in 2023, requiring crypto promotions to meet legal standards. Similarly, France requires influencers to obtain certifications in responsible financial advertising before promoting crypto products.
Overhaul of crypto regulations
In addition to regulations on influencers, the SEC has increased oversight of virtual asset service providers (VASPs) operating in Nigeria.
These companies must now register with the SEC and adhere to strict governance, financial and reporting standards. They must also regularly submit business data, compliance reports and audited financial statements.
The SEC also prohibits the issuance or promotion of cryptocurrencies with enhanced anonymity.
These updated regulations will come into effect in June 2025, signaling a significant shift towards greater transparency and investor protection in the country’s crypto ecosystem.
