The Securities and Exchange Commission (“SEC” or the “Commission”) has released a pre-licensing framework for fintechs that operate in the digital assets and investment space. The Commission on 21 June 2024 issued A Framework on Accelerated Regulatory Incubation Program (ARIP) for the Onboarding of Virtual Assets Service Providers (VASPs) and other Digital Investments Service Providers (DISPs) (the “ARIP Framework”). This follows the proposed major amendment to the Commission’s Rules on the Issuance, Offering Platforms, and Custody of Digital Assets issued on 15 March 2024, which is yet to be finalised.

The ARIP Framework provides guidance to VASPs and other DISPs seeking to operate in Nigeria. VASPs are digital platforms that facilitate the trading and exchange of cryptocurrencies and other digital assets, while DISPs are entities that offer investment products through digital channels. This includes platforms that allow users to purchase stocks, invest in mutual funds, and other investment schemes approved by the SEC.

In this alert, we highlight some of the key provisions of the ARIP Framework and the regulatory obligations of VASPs and DISPs seeking to operate in Nigeria or those with product offerings for Nigerian consumers.