Abdulwahab Isa 
The Securities and Exchange Commission (SEC) has begun deploying blockchain analytics tools and artificial intelligence (AI) to trace transactions, detect fraud, and strengthen cybersecurity in Nigeria’s financial system.
The Commission said the move aims to curb illicit investment activities, Ponzi schemes, and the growing use of digital wallets for money laundering and other financial crimes.
SEC’s Director-General, Dr. Emomotimi Agama, disclosed this on Wednesday in Abuja during a lecture at the Abuja Journalists Academy titled “The Regulation of Digital Assets and Virtual Asset Service Providers in Nigeria.”
Represented by the Head, External Relations Department, Mrs. Efe Ebelo, Agama said the Commission is working closely with the Central Bank of Nigeria (CBN) and the Economic and Financial Crimes Commission (EFCC) to track and freeze illegal digital wallets.
“To strengthen enforcement, the SEC is collaborating with the CBN and EFCC to freeze illicit digital wallets and recover criminal proceeds. Our goal is to ensure that innovation serves progress, not predation,” he stated.
He noted that Nigeria ranks among the top countries in global digital asset adoption, with over one-third of its population engaged in crypto-related activities—reflecting the innovation of Nigerian youths and the push for financial inclusion.
However, Agama cautioned that the rapid growth of digital assets has created opportunities for abuse through crypto scams, fake wallet apps, phishing, and ransomware attacks.
“Without strong regulation, innovation can quickly become vulnerability,” he warned. “Regulation is not about restriction; it’s about building trust and ensuring that innovation strengthens our economy rather than weakens it.”
To mitigate these risks, the SEC has introduced a comprehensive regulatory framework for Virtual Asset Service Providers (VASPs) under its 2022 Rules on the Issuance, Offering, and Custody of Digital Assets, anchored on three pillars—licensing, compliance, and transparency.
Agama explained that beyond issuing regulations, the Commission is leveraging modern technology to enhance market surveillance.
“We are using blockchain analytics, AI, and advanced monitoring systems to strengthen our supervisory capacity,” he said. “This will help us respond faster to suspicious transactions and protect market integrity.”
He added that the collaboration with the CBN and EFCC will improve coordination among regulators and law enforcement agencies, enabling swift action against cross-border financial crimes.
Placing Nigeria’s regulatory approach in a global context, Agama said the Financial Action Task Force (FATF) now mandates all VASPs worldwide to implement anti-money laundering (AML) and counter-terrorism financing (CFT) controls. He cited the European Union’s MiCA framework and recent U.S. enforcement actions against unregistered exchanges as examples of the tightening global oversight.
“The message globally is clear — digital finance must be as transparent, accountable, and investor-friendly as traditional finance,” he said.
Agama stressed that the SEC aims to maintain a regulatory balance that encourages innovation while protecting the financial system from abuse.
“If regulators clamp down too hard, innovation migrates offshore; if they regulate too softly, risks multiply. Our task is to find the right balance that encourages creativity while protecting Nigerians from exploitation,” he added.
He emphasised that digital assets have become a structural pillar of modern finance, reshaping markets and redefining trust, ownership, and value exchange globally.
Concluding, Agama reaffirmed the SEC’s commitment to building a digital finance ecosystem rooted in ethics and transparency.
“The future of finance is digital, but its foundation must remain ethical, transparent, and trustworthy,” he said. “Trust is the ultimate currency, and as regulators, our highest duty is to preserve it.”
He also urged fintech innovators and investors to embrace responsible innovation, assuring that the SEC’s goal is to create a secure environment that promotes financial inclusion, investor protection, and national development.
