The Nigerian Securities and Exchange Commission (SEC) has introduced new regulations to govern the marketing of digital assets, with a particular focus on virtual asset service providers (VASPs) and social media influencers known as "Finfluencers."
VASPs will now need prior approval from the SEC if they engage third-party service providers for promoting their crypto products. This requirement emphasizes the SEC's commitment to overseeing marketing practices and ensuring alignment with established guidelines. VASPs must also verify that their third-party partners comply with the SEC's marketing regulations.
The SEC's revisions also address the role of Finfluencers, who will now need a "no-objection authorization" from the SEC before disseminating any digital asset advertisements. This measure aims to mitigate the risks associated with unverified financial advice and unauthorized promotions. Finfluencers must also confirm that the companies they endorse are licensed by the SEC. Transparency is a key focus, with Finfluencers required to disclose any payments received for promoting crypto products or services.
Non-compliance can result in severe penalties, including fines or imprisonment. The SEC plans to take enforcement actions against unregulated VASPs, as only two exchanges currently hold provisional operating licenses in Nigeria. The agency aims to create a safer environment for investors and promote responsible practices within the cryptocurrency sector.