Nigeria Sees $50 Billion in Cryptocurrency Transactions as Traditional Market Struggles – SEC Reports

Nigeria processed over $50 billion in cryptocurrency transactions between July 2023 and June 2024, highlighting the growing sophistication and risk appetite of local investors, according to the Securities and Exchange Commission (SEC). Dr. Emomotimi Agama, SEC’s Director-General, made the revelation during his presentation at the annual Chartered Institute of Stockbrokers (CIS) conference, noting that this surge contrasts sharply with low participation in the traditional capital market.

Dr. Agama raised concerns about the country’s underwhelming capital market involvement, revealing that fewer than 4% of Nigeria’s adult population actively invest in stocks and bonds. He described this low participation as a major obstacle to economic growth and long-term capital formation, urging policymakers to find ways to rebuild investor confidence and broaden access.

While the traditional market sees limited engagement, more than 60 million Nigerians participate in daily gambling activities, spending roughly $5.5 million, a figure that underscores a clear appetite for risk. Agama suggested that this presents an opportunity: with the right channels, Nigerians’ willingness to take financial risks could be redirected toward productive investments that drive economic development.

Nigeria’s market capitalization-to-GDP ratio, currently around 30%, remains far behind countries like South Africa (320%), Malaysia (123%), and India (92%). Despite progress in initiatives like green bonds, Sukuk, and fintech integration, market liquidity continues to concentrate in a few large-cap stocks, such as Airtel Africa, Dangote Cement, and MTN Nigeria. Dr. Agama called for deeper financial inclusion and stronger alignment with national development goals.

Looking ahead, the SEC boss outlined six key challenges for the market: low retail participation, concentrated trading, declining foreign inflows, underutilized pension funds, untapped diaspora capital, and a $150 billion annual infrastructure funding gap. He urged a “reimagined SEC” to focus on transparency, trust-building, and enabling private-sector-driven growth, emphasizing that the next decade should transform Nigeria’s capital market into a robust engine for national development.

source: Leadership