That $2.1 billion figure That’s not just a statistic—it’s potential that’s been stolen. Stolen from the millions of Nigerians left behind—stolen from West Africans—stolen from the very fabric of our economic future. We’re speaking about schools unbuilt, businesses unfunded, and dreams deferred—all due to the shady underbelly of crypto crime. The worst part? We’re not doing enough to stop it.
Think of it like this: imagine a leaky pipe, constantly draining a precious reservoir. That overstuffed reservoir is Nigeria’s economy, and the leaky pipe is the regulatory vacuum in which cryptocurrency is allowed to operate. We can’t just do a duct tape solution with the other side of the problem via awareness campaigns. What we really want is a complete reimagining of our regulatory apparatus.
KYC/AML: Fortify the Front Lines
The best line of defense against crypto crime is being able to identify who you’re doing business with. Currently, that line is about as useful as a sandcastle in a tsunami. It’s time to truly call for rigorous Know Your Customer (KYC) and Anti-Money Laundering (AML) enforcement.
It takes more than just filling out a form with your name and email address. We’re talking biometric verification, proof of address, source of funds – the whole nine yards. It’s time for crypto exchanges to stop being Wild West saloons and start behaving like the regulated financial institutions that they truly are.
VASPs (Virtual Asset Service Providers) must implement tiered KYC levels. While lower tiers may permit small transactions with simple verification, higher tiers would require significant documentation for larger sums. Rather, they should be thoroughly investigated and flagged as suspicious when transactions fall outside of the expected norms and patterns.
This makes it harder for criminals to use fake identities or launder money through multiple accounts. Most importantly, it vastly increases the cost and risk of such illicit activity.
Implementation costs for smaller VASPs. Solution Extensive subsidized tech solutions, or regulatory sandboxes that support them in their compliance.
Regional Harmony: No Safe Havens
Dr. Agama’s appeal for a harmonized VASP licensing framework across ECOWAS? Pure genius. As we speak, criminals are taking advantage of this regulatory arbitrage. They jump around the globe as digital locusts, leaving devastation in their wake where rules and oversight are the scarcest.
Think of a giant game of whack-a-mole, but replace the moles with money launderers. You close them out in Nigeria, and they’re opening in Ghana. Shut the door in Ghana, and they pop up in Sierra Leone. We need a stronger, region-wide solution, a true united front against crypto crime.
ECOWAS establishes a central body to issue and oversee VASP licenses. Minimum standards for KYC/AML are established and enforced uniformly throughout each member state. A centralized register of blacklisted people and companies is kept.
Prevents criminals from exploiting regulatory loopholes by moving operations to countries with weaker oversight. Provides a predictable environment where legitimate crypto businesses can operate and compete fairly.
The answer is to focus on the bottom line—bigger savings by moving to a coordinated, statewide system. Second, offer extensive technical assistance to countries that lack more sophisticated regulatory frameworks.
International Intel: Connect the Dots
Crypto isn’t limited by borders, and neither can our fight against it. We can no longer afford the isolationist mentality, we must support our workers with international collaboration. Picture it like a neighborhood watch across the world, where we’re all sharing information and looking out for one another.
The CBEX fraud case, in which Nigerians were defrauded of billions, is an extreme example of this. It serves as a clear warning. These scams are frequently cross-border. Whether to identify the perpetrators and reclaim the stolen money, international cooperation is key.
Establish formal channels for information sharing between West African regulators and international law enforcement agencies like Interpol and Europol. Engage in cooperative probes and asset recovery efforts. Implement new sanctions on individuals and entities engaged in cryptocurrency crime.
Allows for the tracking of illicit funds across borders, the identification of international criminal networks, and the freezing of assets held in foreign jurisdictions.
Data privacy concerns and legal complexities. Solution? Establish clear legal frameworks for cross-border data sharing and prioritize cooperation with countries that have strong data protection laws.
Nigerians aren't stupid. We’re not uniquely any more easy marks for shakedowns than the rest of ya. But we’re at risk when we’re doing it in an RE regulatory vacuum. We need to demand better. We need to demand these three fixes.
This isn't just about stopping the $2.1 billion bleed; it's about building a future where crypto can be a force for good in Nigeria, not a tool for exploitation. It’s about protecting the vulnerable, fostering innovation, and ensuring that the promise of decentralized finance doesn't turn into a nightmare of centralized fraud. Let’s repair the pipe, protect the reservoir and make a brighter economic future possible for everyone.
