Tokenizing Infrastructure: A Legal Framework for Blockchain-Based Project Finance For Africa

Abstract

This paper examines the transformative potential of Distributed Ledger Technology (“DLT”) in bridging the massive infrastructure funding gap in emerging markets. Traditional project finance relies on complex, high-friction syndicated loan structures and equity distributions that often exclude smaller institutional investors and lack secondary market liquidity. The Bank for International Settlements defined tokenisation as the process of generating and recording a digital representation of traditional assets on a programmable platform. By tokenizing infrastructure assets, project sponsors can democratize access to capital and automate revenue distribution via Smart Contracts. However, this transition faces significant legal hurdles. This research provides a comprehensive analysis of the existing regulatory landscape, focusing on the Investments and Securities Act 2025 (“ISA 2025”) and the Companies and Allied Matters Act 2020 (“CAMA 2020”) . It interrogates whether infrastructure tokens should be classified as securities, the enforceability of decentralized collateral registries, and the legal standing of automated waterfall payments in bankruptcy scenarios. The paper concludes by proposing a model regulatory sandbox framework designed to provide legal certainty for developers while maintaining robust investor protections.