Nigeria: SEC Raises Alarm Over $2.1bn in Suspicious Crypto Transactions Across West Africa

The Securities and Exchange Commission (SEC) has expressed growing concern over the surge in illicit cryptocurrency activities in West Africa, with the Director-General, Dr. Emomotimi Agama, revealing that the region recorded approximately $2.1 billion in suspicious crypto-linked transactions in 2024, according to data from the Inter-Governmental Action Group against Money Laundering in West Africa (GIABA).

Speaking at the West Africa Compliance Summit held in Praia, Cape Verde, and hosted by GIABA, Dr. Agama highlighted the dual-edged nature of digital asset adoption, noting that while it is fueling financial innovation, it is also attracting a rising tide of fraud, terrorist financing, and regulatory evasion.

“We are witnessing a spike in malicious activities such as DeFi ‘rug pulls,’ artificial market crashes, and the use of privacy coins by terror groups to obscure illicit flows. Unregistered exchanges disappearing with investor funds have also become far too common,” Agama stated.

He warned that these activities pose serious threats to financial stability, investor confidence, and regional security, adding that effective regulation is no longer optional but a necessity.

As part of efforts to strengthen oversight and enforcement in the virtual asset space, Dr. Agama disclosed that the SEC is enhancing its surveillance mechanisms and exploring the deployment of AI-powered blockchain analytics tools to track suspicious transactions and support law enforcement.

He also called for enhanced regional cooperation, urging Economic Community of West African States (ECOWAS) members to harmonise regulatory approaches and close cross-border compliance gaps.

“A trader banned in Nigeria can simply relocate to Ghana and continue operations. That is why ECOWAS must urgently adopt a Unified Virtual Asset Service Provider (VASP) Licensing Framework, to ensure consistent oversight across the region,” he said.

In response to growing investor vulnerability, the SEC has also launched a nationwide investor education campaign to raise awareness around Ponzi schemes and crypto-related fraud. The initiative was triggered by the collapse of the CBEX investment scheme, which defrauded hundreds of Nigerians.

The awareness campaign has already covered key urban centres in Abuja and Lagos, with plans underway to expand outreach to other regions.

The SEC reiterated its commitment to safeguarding the integrity of Nigeria’s capital markets and ensuring that innovation in financial services does not come at the expense of investor protection or regulatory accountability.