The Nigerian Securities and Exchange Commission (SEC) has issued its first licenses to local crypto exchanges to operate within the country, despite contentious relations between the government and industry at large.

Per an SEC press release, both Busha Digital Limited and Quidax Technologies Limited have been granted “approval-in-principle” to operate under its Accelerated Regulatory Incubation Program (ARIP). The agency said the development is part of its “commitment to enabling innovation that would deepen the capital market while guaranteeing the protection of investors.”

“We commend the SEC under the leadership of Dr. Emomotimi Agama, for taking the bold step to bring order, confidence, and investor protection to our industry,” said Buchi Okoro, co-founder and CEO of Quidax, in a statement. “This is a big win for Nigeria’s embrace of crypto, and we are glad to be a part of this historical moment.”

Announced in June, the ARIP is a program to fast-track virtual asset service providers (VASPs) into compliance with its updated regulatory framework on digital asset issuance, exchange, and custody. Existing firms were given 30 days to apply with the program or risk-facing enforcement action.

Nigeria has meanwhile detained two Binance executives—Tigran Gambaryan and Tigran Gambaryan—over the company’s operations in the country since February. Their trial is set to begin next week.

According to a 2023 report from Chainalysis, Nigeria was the number two country in the world in terms of its rate of crypto adoption per population.

Thursday’s announcement confirms Nigeria’s formal acceptance of crypto, which Quidax had prematurely announced earlier this week. It also follows a tweet from the SEC last Wednesday promising to soon license exchanges in Nigeria, but which led to a dead link.

As Okoro told Decrypt, the approval wasn’t so much a pivot by the SEC as much as a “result of years of collaborative effort that takes time to ensure the resources are put in place to ensure compliance.”

Aside from Quidax and Busha, the SEC also announced that five other firms were admitted to test their new technology under Nigeria’s Regulatory Incubation (RI) program.

The firms are blockchain platform Trovotech, Nigerian stablecoin provider Wrapped CBDC, and real-estate token platform HousingExchange.NG, digital real-estate investment platform Dream City Capital, and custody platform Blockvault Custodian.

“Other applications received are being assessed and would be granted approval-in-principle on a case-by-case basis as they meet all SEC requirements,” the SEC stated.

The ARIP and RI programs are “the only avenues for well-intentioned entities” to legitimately operate in the Nigerian capital market, it added.

Edited by Ryan Ozawa.