By Boluwatife Oshadiya | April 1, 2026
Key Points
- Central Bank of Nigeria begins AML/CFT/CPF supervision pilot for selected virtual asset firms
- Six firms including Flutterwave, Paystack, and KuCoin participate in first phase
- Pilot focuses on risk assessment, FATF compliance, and financial system integrity
Main Story
The Central Bank of Nigeria has commenced a targeted Anti-Money Laundering, Counter-Financing of Terrorism, and Counter-Proliferation Financing (AML/CFT/CPF) supervision pilot involving selected Virtual Asset Service Providers (VASPs), marking a significant step in Nigeria’s oversight of crypto-related activities.
In a statement released on March 31, the apex bank said the pilot aligns with provisions of the Money Laundering (Prevention and Prohibition) Act 2022 and the Banks and Other Financial Institutions Act (BOFIA) 2020. The initiative forms part of its broader risk-based supervisory framework aimed at strengthening financial system stability and market integrity.
The pilot includes six entities—cNGN, Flutterwave, Juicyway, KoinKoin, KuCoin, and Paystack—identified for structured regulatory engagement. The CBN clarified that participation does not grant licensing or regulatory approval but is strictly supervisory.
According to the bank, participating firms are required to submit monthly compliance metrics, undergo governance and transaction monitoring reviews, and demonstrate readiness for Financial Action Task Force (FATF) requirements, particularly the Travel Rule on cross-border crypto transactions.
“The pilot is designed to develop a structured understanding of AML/CFT/CPF risks, business models, and operational practices across participating entities,” the CBN stated.
The Issues (Optional)
The move reflects Nigeria’s ongoing effort to close regulatory gaps in the fast-growing virtual asset sector, which has operated in a complex legal environment since earlier restrictions on crypto-linked banking transactions. Despite regulatory caution, crypto adoption in Nigeria remains among the highest globally, driven by currency volatility, remittance demand, and digital payment innovation.
However, concerns around illicit financial flows, sanctions evasion, and weak compliance frameworks have intensified pressure on regulators. The pilot signals a shift toward engagement and structured oversight rather than outright restriction, aligning Nigeria more closely with global standards set by the Financial Action Task Force.
What’s Being Said
“Participation in the Pilot reflects a formal supervisory invitation to engage with the CBN in a controlled and structured environment,” the apex bank said.
Industry analysts note that the inclusion of major fintech players such as Flutterwave and Paystack signals a broader regulatory intent beyond pure crypto exchanges.
“This is less about enforcement and more about intelligence gathering and alignment with global compliance norms,” said a Lagos-based financial compliance analyst.
The Nigerian Financial Intelligence Unit is also expected to collaborate with the CBN on aspects of the supervisory process where necessary.
What’s Next
- Participating firms will submit monthly AML/CFT/CPF compliance reports under CBN templates
- Subsequent phases of the pilot are already scheduled, with no open applications for new entrants
- The CBN is expected to use insights from the pilot to refine its long-term regulatory approach to virtual assets
Bottom Line
The Bottom Line: The CBN’s pilot marks a calibrated shift from restriction to structured oversight in Nigeria’s crypto sector. While it stops short of full regulatory endorsement, it lays the groundwork for a more formalised and globally aligned digital asset framework.
