Once Restricted, Now Taxed: Nigeria's Crypto Governance at a Glance

Over the last decade, Nigeria's relationship with crypto has gone from hostility to "maybe let's talk." Though not so friendly yet, it's getting there.

But the most fascinating part of this journey is how Nigeria now treats cryptocurrencies as securities, meaning transactions with them are now seen as part of citizens' taxable portfolio.

Think about that: the same country whose Central Bank once banned banks from touching crypto now wants a piece of it.

Let's rewind a bit.

The Journey from Ban to Recognition

Back in 2017, the CBN warned banks not to deal with crypto. Then in 2021, it doubled down by instructing financial institutions to block all crypto-related transactions. For years, it felt like the regulators were at war with the blockchain.

But on the other side, the Securities and Exchange Commission (SEC) had a different view. It saw potential and even drafted rules for digital assets in 2021. Sadly, those efforts were abandoned because the CBN's hostility made execution impossible.

Fast forward to today, things have changed.

The 2025 Regulatory Shift

In March 2025, President Bola Tinubu signed the Investments and Securities Act (ISA) 2025, and that law changed everything. It officially placed digital currencies and crypto assets under the SEC's authority. In other words, crypto is now recognized as part of Nigeria's capital market, just like stocks or bonds.

The SEC has also started licensing Virtual Asset Service Providers (VASPs), exchanges and platforms that can legally operate in Nigeria. Two of the first to get approval through the SEC incubation program were Busha and Quidax.

This move also paved the way for the launch of cNGN, Africa's first fiat-backed stablecoin, pegged to the Naira and listed on those two platforms.

(For the record: cNGN isn't issued by the CBN; it's privately issued by a group called Africa Stablecoin Consortium, but regulated.)

The Tax Implications

Now, here's where it gets interesting: the tax part.

In June 2025, Nigeria passed a new tax law that says profits from digital or virtual assets (including crypto) are now taxable.

If you buy and sell crypto and make a profit, that gain is now recognized as taxable income and subject to Capital Gains Tax (CGT).

If you receive payments for services in crypto, those proceeds are now treated as taxable income and subject to Personal Income Tax (PIT).

If you run a crypto business like an exchange or wallet service, you're required to report your users' transactions to the tax authorities and pay Company Income Tax (CIT) where applicable.

On top of all that, there's also Value Added Tax (VAT), which is charged on processing or transaction fees.

Compliance and Penalties

And if you fail to comply? For businesses, it's a ₦10 million fine for the first offense, plus ₦1 million for each subsequent month of default. For users, non-compliance could even lead to account restrictions or closures.

This new rule takes effect in 2026, and marks a shift from trying to ban crypto to finding ways to regulate and tax it.

What This Means for You

So what does this mean for you? It means Nigeria has officially moved from denial to reality. Crypto is here to stay, and the government now wants to bring it into the formal system, both for oversight and for revenue.

But it also means users and businesses have to start thinking differently, most importantly, how to stay compliant.

Not withstanding some little restrictions on crypto trading, like users' difficulty to use regulated financial institutions services on crypto platforms, the recent developments mean Nigeria is going through a major policy shift in real time. One that could define the future of digital finance in Africa's biggest crypto market.