Nigeria Clears Path for Tokenized Stocks Trading Through NASD Exchange

Nigeria's Securities and Exchange Commission (SEC) has cleared eligible companies to issue and trade tokenized securities of traditional stocks through the NASD OTC Securities Exchange, according to a recent announcement.

The approval marks a significant step towards trading tokenized securities in Nigeria, with NASD planning to offer the option early next month. This move is part of the country's effort to deepen its capital markets and leverage technology innovations to meet the financing needs of small- and medium-sized firms.

Tokenized assets will cover traditional shares, bonds, private-market instruments, real estate, and structured investments, offering a faster and lower-cost alternative for businesses struggling to access bank credit and traditional capital markets. Chinwendu Ekeh, NASD's acting Managing Director, described digital securities as providing these firms with 'a credible path' to meet their financing needs.

This development follows President Tinubu's recent signing of an executive order on virtual assets regulation, which is part of Nigeria's broader effort to build a regulatory framework around digital assets. The approval also ties into the country's push towards deeper capital markets, leveraging its tech-savvy youthful population and technology innovations.