Nigerians prefer crypto investments and gambling to the capital market — SEC DG
Emomotimi Agama said the country is missing out on substantial investments because Nigerians avoid investing in the Nigerian capital market.
The Director-General of the Nigerian Securities and Exchange Commission (SEC), Emomotimi Agama, has stated that the Nigerian capital market is missing out on a significant volume of potential investments.
He attributed this to the growing preference among Nigerian youths to invest in cryptocurrencies or participate in online gambling platforms rather than in securities and stocks available in the capital market.
The details
- In an email to Bloomberg, Agama revealed that over 60 million Nigerians spend about $5.5 million daily on gambling platforms. In contrast, many others channel their investments into cryptocurrencies and digital assets — sectors that were previously outside the SEC’s regulatory oversight.
- Agama noted that while more than 60 million Nigerians own cryptocurrencies, fewer than three million invest in the Nigerian capital market.
- According to him, while Nigerians are demonstrating a willingness to invest, they are avoiding putting these investments in the stock and bond options available in the country.
- This unwillingness to invest in state-regulated investment vehicles poses a stumbling block to Nigeria’s economic growth and denies the country access to liquidity that can help plug infrastructural gaps, he added.
- He attributed this to a lack of trust in or access to the Nigerian investments sector, a gap the Nigerian government is now looking to fix by bringing digital assets under the SEC’s regulatory oversight.
Key quotes
- Agama told Bloomberg that the situation “is a major impediment to economic growth and capital formation,” and makes it difficult to plug the nation’s annual infrastructure gap of $150 billion.
- He added:
“An appetite for risk clearly exists, but not the trust or access to channel that energy into the productive sector.”
Key context
- According to Chainalysis, Nigeria tops the charts for crypto adoption in Sub-Saharan Africa, raking in $92.1 billion in crypto value, almost triple the value recorded by South Africa in second place.
- Nigeria also topped Chainalysis’ rankings in terms of crypto value received in 2023 and 2024, highlighting the strong crypto adoption in the country despite unclear regulations.
- Now, regulations are catching up with innovation and adoption. Last year, the SEC launched a regulatory sandbox for crypto exchanges in the country.
- Subsequently, it issued provisional licenses to two local exchanges, Quidax and Busha, but has paused to issue any further licenses has it looks to learn more about the space.
- Earlier this year, the Nigerian president signed the Investments and Securities Act into law, effectively recognizing digital assets as securities and bringing them under the regulatory purview of the SEC.
