Nigeria received more than $92.1 billion in crypto value in the twelve months covered by Chainalysis' 2025 Sub-Saharan Africa study — nearly three times the $31-odd billion received by South Africa, the region's next-largest market. Now the Central Bank of Nigeria is moving to bring that scale inside a formal supervisory perimeter, opening applications for the second cohort of its Regulatory Sandbox Programme with a dedicated Virtual Asset Service Provider track for the first time, according to Business Insider Africa.
The application window runs from August 12 to August 31. Companies building products around stablecoins, wallets, custody, payments, and settlement infrastructure are eligible to apply. Admission to the programme does not constitute a licence to operate — firms accepted will only be permitted to test within parameters agreed directly with the CBN — but the move marks a structural shift in how Africa's largest crypto market is governed.
The pivot is stark when set against recent history. In February 2021, the CBN ordered banks to stop facilitating cryptocurrency transactions and providing services to exchanges. That ban held for nearly three years before the central bank reversed course in December 2023, issuing new guidelines that allowed financial institutions to open accounts for Virtual Asset Service Providers under regulatory conditions. The 2021 restrictions were formally superseded, though Nigerian banks remain prohibited from holding or trading virtual currencies on their own account.
Legislation has since reinforced the regulatory direction. Nigeria's Investment and Securities Act 2025 explicitly classified virtual and digital assets as securities, giving the framework a statutory foundation it previously lacked. The Securities and Exchange Commission has been running a parallel process: its Accelerated Regulatory Incubation Programme admitted GIGX Technologies and KuCoin Nigeria as recently as July, granting both Approval-in-Principle while making clear that status falls short of a final licence. The CBN sandbox adds a third layer — direct central bank observation of virtual-asset technology in live testing conditions — rather than simply supervising whether banks can serve compliant crypto firms.
Stablecoins are the clearest driver of the policy urgency. Chainalysis documented multi-million-dollar stablecoin transactions in Sub-Saharan Africa supporting trade corridors between Africa, the Middle East, and Asia. Nigeria's inflation environment and persistent difficulty accessing foreign currency have made dollar-pegged stablecoins an increasingly practical settlement tool for businesses that cannot rely on correspondent banking. That utility creates genuine monetary-policy and foreign-exchange management questions for the CBN, which is precisely why bringing stablecoin providers into a supervised testing environment matters more than simply licensing crypto exchanges.
The regional context sharpens Nigeria's significance. Chainalysis ranked Sub-Saharan Africa the world's third-fastest-growing crypto region in 2025, with on-chain transaction volumes up more than 50% year-on-year. Nigeria and South Africa are the two largest markets; Ethiopia, Kenya, and Ghana round out the top five. South Africa has moved further along the licensing path for crypto-asset service providers, while most other African regulators are still developing frameworks. Nigeria, given its raw volume, effectively sets the template for how a large emerging-market central bank manages digital-asset adoption without either banning it or abandoning monetary oversight.
The CBN is also running a second, parallel track under the same sandbox: a Data-Enabled Financial Services track for fintech innovations that do not involve virtual assets. That stream targets technologies using secure digital infrastructure and permissioned data sharing to improve payments, credit access, financial inclusion, risk management, and consumer services. Both tracks will assess applicants on innovation quality, readiness for live testing, consumer benefit, governance, and the rigour of proposed testing plans — Nairametrics reported the dual-track design positions the programme as a broader coordination exercise for digital finance, not solely a crypto response.
Why it matters: A market moving $92 billion in annual crypto value cannot be governed by exclusion, and the CBN's sandbox architecture — combined with the SEC's incubation programme and the ISA 2025 — signals that Nigeria has settled on supervision over prohibition. For stablecoin providers and VASP operators, the August 31 deadline is the most concrete on-ramp into formal Nigerian regulatory standing that has existed, and the framework being shaped here will likely serve as the reference point for central bank crypto policy across anglophone Africa.