Onome Amuge
Nigeria’s capital market may be losing ground to digital assets as retail investors flock to unregulated cryptocurrencies in search of quick returns, according to Emomotimi Agama, the director-general of the Securities and Exchange Commission (SEC).
Agama revealed that more than $50 billion worth of cryptocurrency transactions passed through Nigeria between July 2023 and June 2024, a staggering figure that shows both the risk appetite and financial sophistication of Nigerian investors and the deep disconnect between them and the traditional capital market.
Speaking at the Chartered Institute of Stockbrokers’ annual conference in Lagos, where he presented a paper titled “Evaluating the Nigerian Capital Market Masterplan 2015–2025,” the SEC DG said the data highlights the disconnect between Nigerians’ appetite for risk and their limited participation in the formal investment market.
While Nigeria ranks among the world’s most active cryptocurrency markets, fewer than 4 per cent of adults currently invest in the capital market, he disclosed. Out of an estimated 110 million adults, only about three million hold formal investment accounts, a fraction of the population’s potential. In contrast, over 60 million Nigerians participate daily in gambling, collectively spending $5.5 million every day.
Agama described this imbalance as an economic and social distortion, warning that the lack of participation in structured investment channels is undermining the country’s capital formation process and limiting growth.
“The market capitalization-to-GDP ratio in Nigeria stands at around 30 percent. That’s far below South Africa’s 320 per cent, Malaysia’s 123 per cent, and India’s 92 per cent. The implication is simple, our capital market is underperforming relative to our economy,” he noted.
Agama said the weak investor base is one reason Nigeria struggles to mobilize long-term financing for infrastructure, housing, and industrial growth. He argued that the capital market should serve as the country’s engine of transformation, but currently lacks the trust, liquidity, and depth to play that role effectively.
He called for a new strategy to rebuild public confidence, expand access, and retool the SEC as both a regulator and enabler of private-sector-led growth.
“Vision without execution is inertia — and reform without measurement is aspiration without accountability,” he told market stakeholders.
Reflecting on the Capital Market Master Plan (CMMP) 2015–2025, which was launched to deepen market participation and attract long-term capital, Agama said less than half of the 108 initiatives under the plan were fully executed.
He attributed the shortfall to limited alignment with national development priorities, inadequate monitoring, and weak stakeholder ownership.
Still, the SEC boss acknowledged progress in some areas including the development of green bonds, Sukuk issuances, fintech integration, and the growth of non-interest finance products. But market liquidity, he said, remains concentrated in a few large-cap stocks such as Airtel Africa, Dangote Cement, and MTN Nigeria, making the market vulnerable to shocks and discouraging new entrants.
Agama outlined six core challenges for the next phase of capital market reform including; low retail participation, market concentration, falling foreign inflows, underutilized pension assets, untapped diaspora capital, and a widening infrastructure financing gap.
Nigeria’s annual infrastructure deficit, estimated at $150 billion, dwarfs the contribution of the domestic capital market. So far, only about N1.5 trillion has been raised through public-private partnership (PPP) bonds, a figure Agama described as alarmingly low given the scale of the country’s needs.
“This shows a misalignment between financial innovation and national priorities. The capital market must be at the heart of financing roads, power, housing, and digital infrastructure,” he said.
