The Central Bank of Nigeria (CBN) has kicked off a new supervision pilot for virtual asset service providers (VASPs), tightening its oversight of crypto-linked activity with a focus on anti-money laundering and counter-terrorist financing rules.
In a directive dated March 31, the apex bank said the initiative is an Anti-Money Laundering, Counter-Financing of Terrorism, and Counter-Proliferation Financing (AML/CFT/CPF) supervision pilot, targeting a select group of firms operating around virtual assets.
The programme is framed as part of the CBN’s risk-based supervisory agenda and is aimed at reinforcing financial system stability and market integrity in one of the world’s most active virtual asset markets.
The CBN named several prominent Nigerian fintech and crypto-adjacent companies as the first cohort of VASPs to be engaged under the pilot. The list includes:
cNGN
Flutterwave
Juicyway
KoinKoin
KuCoin
Paystack
The central bank stressed that participation is strictly supervisory. It does not amount to regulatory approval, licensing, authorisation or any formal regulatory status for the selected firms.
According to the directive, the pilot will help the CBN deepen its understanding of AML/CFT/CPF risks, business models and operational practices across these companies. That includes how they handle customer onboarding, governance, sanctions screening, transaction monitoring and cross-border activity.
During the pilot, participants will be required to submit monthly AML/CFT/CPF performance metrics and engage directly with supervisors. They will also undergo structured reviews and must show credible plans to implement the so‑called Travel Rule and other financial crime controls.
Nigeria has become a major virtual assets market. Data from blockchain analytics firm Chainalysis shows Nigerians transacted $92.1 billion in cryptocurrencies between July 2024 and June 2025, nearly three times the volume recorded in South Africa, the next-largest African market.
The CBN’s latest move fits into a broader effort to bring this activity under a more coordinated regulatory framework and align with global standards set by the Financial Action Task Force (FATF).
The pilot is designed to push participating VASPs toward compliance with FATF recommendations, particularly:
The Travel Rule, which requires firms involved in virtual asset transfers to share key transaction data across platforms.
Other obligations under FATF Recommendations 15 and 16, which cover new technologies and wire transfers, including virtual assets.
Nigeria was removed from the FATF “grey list” in October 2025, after being listed since February 2023. Strengthening anti-money laundering regimes and improving financial transparency were part of the conditions for exiting that enhanced monitoring list. The inclusion of the Nigeria Financial Intelligence Unit (NFIU) in parts of the current pilot process underscores how seriously authorities are treating enforcement around virtual assets.
The CBN clarified that the new supervision project does not change or override existing regulations on virtual assets, nor does it interfere with the powers of other competent authorities.
Under the Investment and Securities Act (ISA) passed in 2025, Nigeria’s Securities and Exchange Commission (SEC) was formally recognised as the country’s digital assets regulator for capital market-related activities. Separately, the government has outlined a coordinated oversight model for cryptocurrency and other virtual asset activity in a White Paper issued by the Virtual Asset Regulatory Authority (VARA), a council formed in August 2025.
That White Paper describes a supervisory structure anchored by the Virtual Asset Regulatory Council (VARC) and the Virtual Asset Regulatory Office (VARO), with responsibilities distributed among agencies such as the CBN and the Nigeria Revenue Service (NRS), the federal tax authority.
Within that wider architecture, the CBN’s AML/CFT/CPF pilot is positioned as a risk-focused supervisory exercise aimed at better mapping how Nigerian VASPs operate and how they manage financial crime threats at scale.
Paul Balo is the founder of TechBooky and a highly skilled wireless communications professional with a strong background in cloud computing, offering extensive experience in designing, implementing, and managing wireless communication systems.
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