Nigeria’s Securities and Exchange Commission (SEC) has approved the launch of tokenized shares on the NASD OTC Securities Exchange, branding a milestone in the country’s capital market modernization.
The SEC’s approval allows the NASD OTC Securities Exchange, Nigeria’s over‑the‑counter market, to begin offering tokenized shares and other digital securities starting next month. This follows a 2023 regulatory green light for asset‑backed digital tokens, which NASD has since developed with Canadian blockchain firm Blockstation Inc.
The exchange’s acting Managing Director, Chinwendu Ekeh, described the initiative as “the beginning of a new era in capital formation,” emphasizing its role in lowering barriers for small and medium‑sized enterprises (SMEs).
The SEC formally documented its approval under Nigeria’s digital asset regulatory framework, which has gradually expanded since 2023 to include tokenized instruments. Through the granted permission to NASD to tokenize shares, bonds, and other assets, the regulator is demonstrating its commitment to financial inclusion and capital market innovation.
Nigeria’s bigger goal is to open capital markets to its youthful population—over 60% of Nigerians are under 30—and to SMEs that struggle to access bank loans or traditional stock listings.
Tokenization provides a pathway for these groups to raise funds and participate in investment markets without the heavy costs and bureaucracy of conventional systems.
What Are Tokenized Assets?
Tokenized assets are digital representations of real‑world assets—such as shares, bonds, or real estate—recorded on a blockchain.
Each token corresponds to ownership rights in the underlying asset, allowing investors to buy, sell, and transfer stakes more efficiently. Unlike cryptocurrencies that may be speculative, tokenized assets are backed by tangible value and subject to regulatory oversight.
Through leverage of blockchain, tokenized assets enable instant settlement, reduced paperwork, and lower transaction costs, while maintaining transparency and security.
How Tokenized Assets Will Help Crypto Adoption in Nigeria
Tokenized shares are expected to accelerate crypto adoption in Nigeria by bridging traditional finance and blockchain.
Investors will be provided a familiar entry point into digital assets, backed by regulated securities rather than volatile tokens. Tokenization also offers SMEs a credible, low‑cost way to raise capital, potentially transforming Nigeria’s entrepreneurial landscape.
The initiative also strengthens Nigeria’s position as a regional leader in blockchain adoption, alongside peers like South Africa, Kenya, and Ghana. Tokenization, when embedded into regulated markets, creates a framework for the country where crypto technology supports real economic activity rather than existing solely in speculative trading.
Regulated tokenized assets could also democratize access to investment opportunities, allowing everyday Nigerians to participate in capital markets through mobile platforms and digital wallets. This aligns with Nigeria’s fintech boom, where mobile money and digital payments are already widespread.
SEC’s approval is a strategic move to harness Nigeria’s youthful population, strengthen financial inclusion, and position itself as a leader in Africa’s digital asset economy. It demonstrates to the crypto community how tokenization can serve as a bridge between traditional finance and blockchain innovation, paving the way for bigger adoption and sustainable growth.
