Legal Status of Cryptocurrencies in Nigeria: What’s Allowed, What’s Not in 2025

Back in 2021, if you wanted to buy Bitcoin in Nigeria, your bank might have shut down your account. Crypto traders were forced to use peer-to-peer apps, cash deposits, or offshore accounts just to get started. The Central Bank of Nigeria had banned financial institutions from handling crypto transactions - and for a while, it looked like the country was shutting the door on digital assets for good.

But Nigeria didn’t shut down. It adapted. People kept trading. The volume kept rising. By 2024, Nigeria led the world in peer-to-peer crypto transactions, handling more than $80 billion in a single year. Regulators couldn’t ignore it anymore. And in March 2025, everything changed.

The New Law That Changed Everything

On March 25, 2025, President Bola Ahmed Tinubu signed the Investments and Securities Act (ISA 2025) into law. This wasn’t just an update - it was a full rewrite of how Nigeria treats financial assets. For the first time, crypto is officially recognized under Nigerian securities law.

The ISA 2025 defines a crypto asset as "a digital representation of value that can be transferred, digitally traded and used for payment or investment purposes." That’s important. It means Bitcoin, Ethereum, Solana - and even some NFTs - now fall under the same legal umbrella as stocks and bonds. But here’s the catch: crypto is still not legal tender. You can’t pay your electricity bill or buy fuel with Bitcoin. The Nigerian naira is still the only official currency.

That distinction matters. Crypto isn’t money. It’s an investment asset. And that means it’s now regulated like one.

Who’s in Charge Now?

Before 2025, no one really knew who was in charge. The Central Bank of Nigeria (CBN) banned banks from dealing with crypto. The Securities and Exchange Commission (SEC) issued vague warnings. The Economic and Financial Crimes Commission (EFCC) raided offices without clear legal grounds. It was chaos.

Now, the SEC is the main regulator. It has full authority over crypto exchanges, token sales, investment platforms, and even online forex brokers that offer crypto-like products. All Virtual Asset Service Providers (VASPs) - that’s exchanges, wallets, and trading platforms - must register with the SEC. Quidax and Busha got early approval. Others are still waiting.

The SEC can now audit platforms, freeze accounts, remove executives, and shut down operations. If a platform lies about its security or runs a fake staking program, the SEC can act - fast.

But the SEC doesn’t work alone. It now coordinates with three other agencies:

• CBN: Still controls banking rules and monetary policy. Banks can now open accounts for licensed VASPs - but only if they follow CBN’s AML rules.
• EFCC: Investigates fraud, money laundering, and scams. They can now access telecom records to track suspicious crypto activity.
• NFIU: The Nigerian Financial Intelligence Unit monitors transactions for signs of terrorism financing or illicit flows.

This multi-agency setup is new. It’s designed to close the gaps that scammers used to exploit.

What About Taxes?

If you made money trading crypto in Nigeria before 2025, you probably didn’t pay taxes on it. The government didn’t have a clear system to track it - and most people didn’t know they were supposed to.

That changed with the Nigeria Tax Administration Act (NTAA) 2025, signed in June 2025 and taking effect in 2026. Now, VASPs are legally required to collect and report tax data on every trade, transfer, or withdrawal.

Here’s how it works:

• Every time you sell crypto for naira or swap one coin for another, the platform must record the transaction.
• They must report gains to the Federal Inland Revenue Service (FIRS).
• If you’re a trader or investor, you’re responsible for declaring those gains on your personal tax return.

Non-compliance has serious consequences. A VASP that fails to report for one month faces a ₦10 million fine (about $6,693). Each additional month adds another ₦1 million. The SEC can also suspend or revoke their license. That’s not a warning - it’s a death sentence for a crypto business.

Between July 2024 and June 2025, Nigeria saw $92.1 billion in crypto inflows. That’s nearly double what South Africa handled. The government knows this money is moving - and now it wants its cut.

What’s Still Illegal?

Just because crypto is legal doesn’t mean everything is allowed.

Ponzi schemes are now explicitly banned. If someone promises you 10% daily returns on your Bitcoin investment, that’s a crime - and the SEC has new tools to track them down. The EFCC can trace wallet addresses, subpoena exchange records, and even freeze assets before trials begin.

Unlicensed platforms are illegal. If you’re running a crypto exchange out of your apartment and not registered with the SEC, you’re breaking the law. The same goes for influencers promoting crypto tokens without disclosure. The SEC now requires clear disclaimers on all financial promotions.

Government agencies can’t raise money through crypto. If a state wants to issue bonds, they must follow traditional public debt rules - and can’t borrow more than 50% of their projected revenue. That’s to prevent reckless spending masked as "blockchain innovation."

Artistic NFTs are fine. If you’re selling digital art, music, or collectibles as NFTs - and not marketing them as investments - you’re not regulated. But if you say "buy this NFT and earn passive income," you’re now in SEC territory.

What’s Changed for Users?

For everyday Nigerians, the changes are subtle but powerful.

You can still buy Bitcoin on P2P apps like Paxful or LocalBitcoins. You can still send crypto to friends or use it to pay for services overseas. The law doesn’t stop you from using crypto privately.

But if you want to use a Nigerian-based exchange - like Quidax, Binance NG, or RiseX - you now have to go through KYC. Your ID, proof of address, and phone number are verified. Your transactions are logged. Your tax data is reported.

That means less anonymity - but also more safety. Scam platforms are being shut down. Fake staking apps are disappearing. If your funds vanish from a licensed exchange, you have legal recourse.

And for those who want to invest in global markets, the ISA 2025 opens new doors. Platforms like Bamboo now let Nigerians buy U.S. stocks with as little as $10. The law now recognizes these as legitimate investment channels - as long as they’re registered.

What’s Still Unclear?

The law is clear on many things - but not everything.

There’s still no official guidance on how to calculate capital gains. Do you use the price at purchase? At sale? What if you swapped ETH for SOL and then sold it? The FIRS hasn’t released detailed rules yet.

Licensing delays are real. Over 120 VASPs applied for SEC registration. Only 12 have been approved so far. Many smaller platforms are stuck in limbo - unable to operate legally, but afraid to shut down.

And while the SEC has broad powers, it’s still a small agency. It has 300 staff. Nigeria has over 200 million people. Enforcement will be uneven.

Finally, the law doesn’t cover decentralized protocols. If you use Uniswap or a non-custodial wallet to trade directly, there’s no entity to regulate. The SEC can’t touch that - yet.

Where Is Nigeria Headed?

Nigeria’s crypto story is no longer about bans. It’s about control.

The government didn’t try to stop crypto. It realized it couldn’t. So it decided to own it.

By bringing crypto under securities law, taxing it, licensing operators, and cracking down on fraud, Nigeria has created one of the most advanced crypto frameworks in Africa. It’s not perfect. But it’s functional.

Other African nations are watching. Ghana, Kenya, and South Africa are all drafting similar laws. Nigeria’s model - clear rules, strong enforcement, tax integration - might become the template.

For Nigerians, the message is simple: crypto isn’t illegal. But if you’re going to trade it, invest in it, or build a business around it - you play by the rules now. There’s no more hiding. And that’s a good thing.