Nigeria’s top financial regulator has raised concerns that a massive surge in cryptocurrency and gambling is draining the nation’s formal investment base.

Dr. Emomotimi Agama, Director-General of the Nigerian Securities and Exchange Commission (SEC), stated that more than $50 billion in cryptocurrency transactions passed through Nigeria between July 2023 and June 2024.

Speaking at the Chartered Institute of Stockbrokers’ annual conference, Dr. Agama highlighted the sharp contrast between speculative markets and traditional capital markets. While fewer than 4% of Nigerian adults invest in stocks or bonds, over 60 million Nigerians participate in gambling daily, placing an estimated $5.5 million in wagers.

“Nigerians have shown a clear appetite for risk, but not the trust or access to direct that energy into wealth creation,” Dr. Agama noted.

This trend, fueled by a young population and a desire to hedge against currency volatility, is diverting liquidity from the nation’s capital markets. Nigeria’s market capitalization-to-GDP ratio is approximately 30%, lagging far behind South Africa’s 320%.

Dr. Agama called for a new approach, not to oppose crypto, but to link it with traditional markets. He argued the path forward is to channel Nigeria’s existing risk appetite and digital fluency into genuine, structured wealth creation.

Source: Sandmark