Experts highlight opportunities and risks in Nigeria’s evolving trust sector
Digital transformation continues to reshape Nigeria’s financial sector, with trust services emerging as one of the areas experiencing rapid technological change.
Industry experts say the Investment and Securities Act 2025 has created a legal framework that supports the adoption of digital assets and blockchain technology in trust administration.
The development marks a shift from traditional paper-based systems to faster and more automated digital processes.
Tokenisation expands investment access
Experts noted that tokenisation could open investment opportunities to more Nigerians.
The process allows high-value assets such as real estate and infrastructure to split into smaller investment units.
This structure gives smaller investors access to markets that previously favoured wealthy individuals and institutions.
Analysts also said blockchain trading platforms could improve liquidity by making digital assets easier to buy and sell.
Smart contracts improve efficiency
Technology experts identified smart contracts as another major benefit of digital transformation.
They explained that automated systems can process distributions, compliance checks, and other routine tasks without delays.
The use of blockchain technology also strengthens transparency because every transaction remains permanently recorded and traceable.
Experts added that digital systems could lower operating costs by reducing dependence on intermediaries.
Regulatory and cybersecurity concerns remain
Despite the benefits, analysts warned that several risks still surround digital trust services.
They pointed to uncertainty over the classification of some digital tokens under existing regulations.
Experts also raised concerns about cyberattacks, hacking, and the loss of private keys linked to digital wallets.
According to them, trustees must adopt stronger security measures to protect sensitive financial information.
Trustees face growing fiduciary responsibilities
Legal experts said trustees still carry full fiduciary responsibility despite increased automation.
They warned that reliance on smart contracts and blockchain systems does not remove accountability.
Trustees must monitor digital systems closely to prevent breaches, coding errors, or operational failures.
Experts also stressed the importance of informing beneficiaries about risks linked to digital assets and cybersecurity threats.
Industry urged to balance innovation with oversight
Stakeholders advised trust service providers to combine technology with human supervision.
They recommended building internal expertise in blockchain technology and digital asset management.
Experts also urged stronger collaboration between regulators, fintech firms, and trust institutions.
According to analysts, transparent communication with beneficiaries remains critical as digital trust services expand.
They noted that Nigeria’s trust sector now stands at a major turning point under ISA 2025.
Industry leaders believe the future of trust administration will depend on balancing innovation with accountability and legal responsibility.
