Digital currency has been a difficult topic across the world; while the twenty-first century has seen several improvements and changes, notably in financial technology, the block chain that gave rise to several cryptocurrencies remains the most contentious subject (Sakiz & Gencer, 2019). Oil has virtually lost its status as a vital commodity in both developed and developing countries, while data has taken its place. Indeed, cellphones and world-wide-web have improved data availability, ubiquity and identification (Obisesan et al., 2024). Hayek (1976) argued that an autonomous monetary system having a low cost of production is essential for restoring price stability. At the time, most Western countries were suffering severe price instability, which was politically driven and was challenging for the monetary authority to resolve. The revived interest in other forms of currency began in the 1990s as a result of technical advancements, resulting in the creation of digital monies such as Flooz, Digi Cash, and Beenz (Fernández-Villaverde and Sanches, 2018). According to Utomo (2018), digital currency is one that uses cryptography for security; it is a method of exchange designed to facilitate the exchange of electronic information through a series of steps that utilize the idea of crypto currency; in other words, it is a digital currency created using the technology of block chain. Block chain technology is used to create digital currencies, which makes them impossible to counterfeit due to their robust security measures. Since they have the same functions as money, these currencies can potentially be utilized as an asset, a store of value, and a medium of exchange. However, unlike money, cryptocurrency has no tangible evidence because it is only stored in data. Because of its applicability, especially as a means of transferring physical goods, businesses like Citibank have introduced their own cryptocurrencies, increasing their global popularity (Mazikana, 2019). Regarding the theoretical connection between digital money and economic growth, there are several issues and solutions. In particular, there are issues with digital currency’s distribution, stability, and compatibility with fiat money. Although this structure theoretically allows stability of price, sensible monetary regulation and its effective distribution continue to be more pressing concerns. Some people with dubious intentions can easily use digital currency for their own gain, despite the fact that technological advancements have made it relatively easy to create and eliminate the possibility of third-party transaction costs.
Citing concerns about money laundering and the financing of terrorism, the Central Bank of Nigeria issued a circular in 2021 prohibiting domestic banks from processing cryptocurrency transactions. It further directed the banks to close accounts linked to cryptocurrency trading.

Furthermore, even though the recent surge in the value of some cryptocurrencies, such as Bitcoin, Ethereum, and Binance token, further increased the relevance of digital money and, particularly, blockchain in countries across the globe, if there is no availability of alternate copy of data, the control of digital currency might not be found on the device where the specific coin is being stored. This is because the price of the currency is still very volatile and is dependent on supply and demand (Obisesan et al., 2024). Bitcoin, in particular, has remained volatile over time. Only 50 bitcoin units were reported in 2009; by 2017, that figure had climbed to almost 17 million. At the same time, it has received increasing recognition from other businesses and now has over ten million owners (Salisu et al., 2023). Its price has also changed. Bitcoin’s price has lately climbed, growing from 26600 USD in June 2022 to about 42265 USD in December 2023 and now above 88000 USD in 2025. Ethereum, Litecoin, and Binance Token all adhere to this pattern. As a result, it is critical to assess their capitalization, volume, and volatility in connection to economic efficiency.

The regulators

Cryptocurrency possesses the attributes of both money and securities. Like money, some cryptocurrencies can be used to buy goods and services, while other crypto projects are akin to securities or investment, with the expectation of future profits. Due to its functionality – as money and securities – the following regulators have taken steps to regulate cryptocurrencies in Nigeria.

Securities and Exchange Commission (SEC)

The SEC was established by the Investment and Securities Act 2007 (the ‘ISA’) and empowered to, among other things, regulate investments and securities business in Nigeria and register and regulate securities exchanges, capital trade points, futures, options and derivative exchanges, commodity exchanges and any other recognised investment exchange.[1]

Central Bank of Nigeria (CBN)

The CBN is empowered by the Central Bank of Nigeria Act 2007 (the ‘CBN Act’) to, among other things, issue legal tender currency in Nigeria and promote a sound financial system in the country.[2] Given that there is no legislation prohibiting cryptocurrency, the CBN’s approach to regulating it has been in the form of directives or guidance to its regulated entities, including banks and other financial institutions.

The Nigerian Securities and Exchange Commission (SEC) is revising regulations to enable cryptocurrency taxation.

According to Bloomberg, the SEC said the move to tax crypto is the regulator’s way of exploring more ways to earn revenue.
Beyond taxation, the bill proposes additional levies on transactions conducted through regulated exchanges in Nigeria.
The SEC also aims to expand its crypto licensing framework, enabling Nigerians to trade on centralized exchanges where transactions can be more easily monitored and taxed.
The SEC has not disclosed the tax percentage or the expected revenue from these levies

Crypto regulations in Nigeria have begun to pick up pace despite a widespread crackdown on crypto last year.
In 2023, the Central Bank of Nigeria opened the door to the asset class by issuing a circular to Nigerian financial institutions, permitting them to serve exchanges provided they are SEC-licensed.
Although the requirements appeared more restrictive than innovative upon closer examination, the overall response to the rules was one of relief — signaling that the country is gradually embracing crypto

HIGHLIGHTS

The Cryptocurrencies market in Nigeria is projected to reach a revenue of US$1.6bn in 2025.
It is expected to show an annual growth rate (CAGR 2025-2025) of NaN%, resulting in a projected total revenue of US$1.6bn by 2025.
The average revenue per user in the Cryptocurrencies market in Nigeria amounts to US$60.1 in 2025.
From a global comparison perspective, it is evident that the highest revenue is reached United States, with a projected revenue of US$9.4bn in 2025.
In the Cryptocurrencies market in Nigeria, the number of users is expected to amount to 25.86m users by 2025.
The user penetration rate will be 11.02% in 2025 or is expected to reach 11.02% by 2025.
Nigeria’s growing interest in cryptocurrencies is driven by its young population, high mobile phone penetration, and the need for alternative financial solutions.

Currently, the cryptocurrency market has been experiencing a period of volatility, with fluctuations in the value of major cryptocurrencies such as Bitcoin, Ethereum, and Dogecoin. The market has also seen a rise in the number of altcoins, or alternative cryptocurrencies, with unique features and use cases.
Several growth factors are driving the growth of the cryptocurrency market, including increasing acceptance and adoption of cryptocurrencies by individuals and institutions, growing interest in decentralized finance (DeFi) platforms, and the potential for cryptocurrencies to serve as a hedge against inflation and political instability. Additionally, advancements in blockchain technology and the increasing use of cryptocurrencies for cross-border transactions are also contributing to market growth.
The cryptocurrency market is expected to continue growing in the coming years. The increasing adoption of cryptocurrencies by businesses and individuals, along with the ongoing development of DeFi and other blockchain-based platforms, is likely to fuel this growth. However, the market is also likely to experience volatility and corrections, as is typical with any emerging and rapidly evolving market

It is clear that the emergence of cryptocurrency and other forms of digital payments will proof to be pivotal to aligning Nigeria with its vision towards the path to economic rehabilitation and fostering economic growth to ensure faster payments for newer and emerging industries within the region.