Is Crypto Regulated in Nigeria? The Full 2025 Legal Breakdown

For years, Nigeria’s relationship with cryptocurrency was a mess. Banks froze accounts. Users couldn’t deposit funds. Exchanges operated in the shadows. And yet, Nigerians kept buying Bitcoin, Ethereum, and stablecoins - even when the system tried to stop them. By 2024, Nigeria had become one of the top five crypto markets in the world, with over $92 billion in crypto value flowing in over just 12 months. So what changed? In March 2025, everything changed.

The New Rules: Crypto Is Now Legal - and Heavily Regulated

Nigeria didn’t just soften its stance on crypto. It rewrote the entire rulebook. The Investments and Securities Act (ISA) 2025 officially recognized digital assets as securities under Nigerian law. That means Bitcoin, Ethereum, and even some NFTs are no longer in a legal gray zone. They’re now treated like stocks or bonds - and that brings serious rules.

The Securities and Exchange Commission (SEC) is now the main watchdog. It’s the only body that can license crypto exchanges, trading platforms, and other Virtual Asset Service Providers (VASPs). Before 2025, the Central Bank of Nigeria (CBN) had banned banks from dealing with crypto firms. Now, the CBN has fully reversed that. Banks can open accounts for licensed crypto companies - but only if those companies are SEC-approved.

This isn’t just a policy tweak. It’s a full system overhaul. Nigeria didn’t follow the path of countries like Kenya or South Africa, which slapped taxes on crypto and called it a day. Instead, Nigeria built a licensing framework that’s among the most detailed in Africa.

Who Needs a License? And How Do You Get One?

If you’re running a crypto exchange, wallet service, or token sale in Nigeria, you need a license. There’s no gray area. The SEC has created clear categories:

• Crypto Exchange License - For platforms that let users buy, sell, or trade crypto
• Custodial Wallet Provider License - For services that hold users’ private keys
• Token Offering Platform License - For companies selling crypto tokens to the public

To qualify, you must meet strict requirements:

• Minimum paid-up capital of ₦500 million ($335,000)
• A fidelity bond (insurance) covering at least ₦200 million ($134,000)
• Registration with the Corporate Affairs Commission (CAC) as a Nigerian company
• A physical office in Nigeria with local management
• Compliance with anti-money laundering (AML) and know-your-customer (KYC) rules

The SEC started granting provisional licenses in late 2024. Two local platforms - Quidax and Busha - were the first to get them. Over 50 other companies have applied. But getting approved isn’t fast. The SEC is doing deep background checks, reviewing tech infrastructure, and verifying financial records. Delays are common.

What’s Still Not Allowed?

Even with new rules, there are hard limits:

• No unlicensed platforms - Operating without an SEC license is illegal. The SEC can shut them down and freeze assets.
• No Ponzi schemes - Any crypto project promising guaranteed returns is banned. The SEC has already taken action against several fake investment platforms.
• Peer-to-peer trading is still legal - You can still buy crypto from another person using WhatsApp, Telegram, or local payment apps. But if you’re doing it at scale - like running a P2P marketplace - you need a license.
• Artistic NFTs are fine - If you’re selling digital art, music, or collectibles without tying them to financial returns, you’re not regulated. But if you’re selling an NFT as an investment - promising dividends or resale profits - it’s a security. And that means SEC oversight.

The Economic and Financial Crimes Commission (EFCC) and the Nigerian Financial Intelligence Unit (NFIU) also have powers to investigate suspicious transactions. They can request telecom records, bank logs, and wallet addresses to track illegal activity.

Taxes Are Coming - And They’re Strict

The Nigeria Tax Administration Act (NTAA) 2025 took effect in June 2025, but enforcement starts in 2026. Here’s what you need to know:

• All crypto transactions - buys, sells, trades - are taxable events
• Capital gains from crypto sales are taxed at 10% to 25%, depending on income level
• VASPs must report transaction data to the Federal Inland Revenue Service (FIRS)
• Non-compliance penalties start at ₦10 million ($6,693) for the first month, then ₦1 million ($669) per month after that
• The SEC can suspend or revoke licenses for tax evasion

This isn’t a warning. The FIRS already has access to data from licensed exchanges. If you’re trading crypto and not reporting it, you’re at risk.

How Is This Different From Before?

Before 2025, Nigeria’s crypto scene was chaotic. In 2021, the CBN banned banks from servicing crypto businesses. Thousands of accounts were frozen. People lost access to their funds. Exchanges had to move offshore. Users turned to peer-to-peer markets, often paying 10-20% premiums for USD-backed stablecoins.

The regulatory gap created a wild west. Scams thrived. People lost millions to fake platforms. No one was accountable.

Now, the system is designed to prevent that. Licensed platforms must keep records for at least five years. They must verify user identities. They must report suspicious activity. And if they fail? They lose their license - and face criminal charges.

What Do Users Think?

Most Nigerians welcome the change. For the first time, there’s clarity. You know what’s legal. You know who to trust. But there’s still fear.

Social media is full of questions:

• “Will the government track every crypto transaction?”
• “Can I still use Binance or Coinbase?”
• “Is this just a way to control our money?”

The truth is, international exchanges like Binance and Coinbase are not licensed in Nigeria. That means Nigerians can’t use them to deposit or withdraw naira. You can still access them to trade - but you can’t link your Nigerian bank account. That’s a big hurdle.

The real winners are local platforms like Quidax and Busha. They’ve spent millions to comply. Now they have a legal monopoly on naira-crypto trading. That’s good for them. But it’s not great for users - fewer choices, higher fees.

Can You Still Use Crypto in Nigeria?

Yes - but only if you play by the rules.

If you’re an individual:

• You can buy crypto via licensed exchanges (Quidax, Busha, others soon to come)
• You can hold it in your own wallet
• You can sell it and withdraw to your bank account - if the exchange is licensed
• You must report gains on your tax return starting in 2026

If you’re a business:

• You must get an SEC license to operate a crypto service
• You must hire local compliance officers
• You must submit quarterly reports to SEC and FIRS
• You must keep all transaction records for five years

The system isn’t perfect. Licensing is slow. Costs are high. But it’s predictable. And that’s what matters.

What’s Next for Nigeria’s Crypto Market?

More licenses will be granted in 2026. The SEC plans to approve at least 15 new VASPs by the end of the year. International firms are watching closely. Some are setting up local subsidiaries just to qualify.

The goal? To turn Nigeria into Africa’s crypto hub. The government believes regulation will attract foreign investment, create tech jobs, and bring millions of unbanked Nigerians into the formal economy.

It’s working - slowly. Crypto adoption hasn’t slowed. If anything, it’s growing. People aren’t leaving crypto. They’re just moving to the legal side.

The biggest risk now? Overregulation. If the rules get too strict, innovation will flee. But so far, Nigeria’s approach is balanced. It’s not banning crypto. It’s bringing it into the light.