Legal Status of Cryptocurrencies in Nigeria: What You Need to Know in 2026

When Nigeria banned banks from handling cryptocurrency transactions in 2021, it seemed like the end of the road for digital assets in the country. But that ban didn’t stop millions of Nigerians from trading Bitcoin, Ethereum, and other coins. In fact, Nigeria became the world’s top country for peer-to-peer crypto trading. Why? Because people didn’t wait for permission - they built their own systems. Now, in 2026, the government has finally caught up. The legal status of cryptocurrencies in Nigeria isn’t about whether they’re allowed - it’s about how they’re regulated, taxed, and monitored.

Bitcoin and Crypto Are Not Illegal - But They’re Not Legal Tender

You can still buy, sell, and hold Bitcoin in Nigeria. There’s no law that says owning crypto is a crime. But here’s the catch: cryptocurrency is not legal tender. That means you can’t walk into a shop in Lagos and pay for rice with Bitcoin. The Nigerian naira is still the only official currency for government transactions, taxes, and bank payments.

This isn’t unique to Nigeria. Most countries treat crypto like property or an asset, not money. In Nigeria, that means crypto is treated as a security under the new Investments and Securities Act (ISA 2025) a comprehensive law signed into effect on March 25, 2025, that reclassified digital assets as securities under Nigerian capital market rules. This shift is huge. It’s not about banning crypto - it’s about bringing it into the same legal space as stocks, bonds, and mutual funds.

The SEC Now Has Full Control Over Crypto Exchanges

Before 2025, the Securities and Exchange Commission (SEC) Nigeria’s primary regulator for capital markets, now granted authority over all crypto trading platforms, token issuances, and investment-related digital assets had no real power to stop shady crypto businesses. Now, it does. Under ISA 2025, every crypto exchange, wallet provider, or trading platform operating in Nigeria must register with the SEC as a Virtual Asset Service Provider (VASP) any entity that facilitates the transfer, exchange, or custody of digital assets, now legally required to obtain SEC licensing.

Companies like Quidax and Busha got their licenses early. Others are still waiting. The SEC isn’t just rubber-stamping applications - it’s doing deep background checks. They’re looking at who owns the company, where the money comes from, how user data is protected, and whether the platform has real anti-fraud systems. If you’re running a crypto business in Nigeria and you haven’t applied, you’re operating illegally now.

The SEC can shut down platforms, freeze assets, remove executives, and fine companies up to ₦500 million. That’s serious. And it’s not just about big exchanges. Even small P2P platforms that let users trade crypto for naira must now comply.

Multi-Agency Oversight: Who’s Really in Charge?

Nigeria didn’t just give one agency more power. It built a whole new system. The SEC works hand-in-hand with three other agencies:

• Central Bank of Nigeria (CBN) Responsible for monetary policy and banking regulations, now coordinates with SEC to ensure crypto activities don’t destabilize the naira or banking system
• Economic and Financial Crimes Commission (EFCC) Investigates crypto-related fraud, scams, and money laundering, with new access to telecom records to trace transactions
• Nigerian Financial Intelligence Unit (NFIU) Monitors all VASPs for suspicious activity, ensuring compliance with anti-money laundering and counter-terrorism financing rules

This isn’t bureaucracy for the sake of it. It’s a response to years of abuse. In 2023, over ₦12 billion in crypto scams were reported. Many were run by people using fake identities and offshore accounts. Now, regulators can request call logs, bank records, and IP addresses to track down fraudsters. That’s a game-changer.

Crypto Taxation Is Now Real - And It’s Strict

If you made money trading crypto in 2025, you owe taxes. The Nigeria Tax Administration Act (NTAA 2025) enacted in June 2025 and effective from January 2026, mandates VASPs to collect and report user tax data, with penalties for non-compliance made that official. VASPs are now required to report every trade, every withdrawal, and every deposit made by Nigerian users.

Here’s how it works:

• Every time you sell Bitcoin for naira, the exchange must record the profit.
• That profit is taxed as capital gains - just like selling a house or stocks.
• If you don’t pay, the exchange will freeze your account until you do.
• Companies that fail to report face fines: ₦10 million ($6,693) in the first month, plus ₦1 million for every month after.

The numbers tell the story. Between July 2024 and June 2025, Nigeria received over $92.1 billion in crypto value. That’s nearly double what South Africa handled. The government isn’t blind to that. They know crypto is a major economic force. Now they’re trying to make sure they get their share.

What About NFTs? Are They Regulated Too?

Not all NFTs are treated the same. If you bought an NFT of a digital artwork just to show off on your phone - no problem. That’s art. But if someone sold you an NFT promising a share of profits, royalties, or future value - that’s a security. And that’s regulated.

The SEC now watches NFTs marketed as investments. If a project says, “Buy this NFT and earn 15% monthly returns,” it’s a Ponzi scheme. And it’s now illegal. The law doesn’t ban NFTs - it bans fraud disguised as NFTs.

That’s why you’re seeing fewer “get rich quick” NFT projects in Nigeria. The regulators are watching. And they’re not afraid to act.

Why Did Nigeria Change Its Mind?

In 2021, the Central Bank banned banks from dealing with crypto. The goal? Stop money laundering and protect the naira. But it backfired. Instead of stopping crypto, the ban pushed it underground. People started using offshore banks, prepaid cards, and even cash handovers to trade Bitcoin. The black market grew.

By 2023, Nigeria was handling more P2P crypto trades than any other country. The CBN realized: you can’t stop what people are already doing. You can only regulate it.

The ISA 2025 and NTAA 2025 are the result of that lesson. The government didn’t try to kill crypto. It decided to own it. To control it. To tax it. And to protect ordinary people from scams.

What Does This Mean for You?

If you’re a regular user:

• You can still buy and sell crypto. No changes there.
• Use only SEC-licensed platforms. Check their website for the license number.
• Keep records of every trade. You’ll need them for taxes.
• Don’t fall for “guaranteed returns.” If it sounds too good to be true, it is.

If you’re a business:

• Apply for your VASP license now. The process is slow - don’t wait.
• Set up AML/KYC systems. The SEC will audit you.
• Start reporting taxes. Even if you’re small, you’re still required to.

The old days of wild west crypto are over. Nigeria isn’t shutting down crypto - it’s bringing it into the light. And for the first time, there’s a real path for honest players to thrive.

What’s Next?

The next big move will be international cooperation. Nigeria is already talking to Ghana, Kenya, and South Africa about cross-border crypto regulation. Imagine a single license that lets you operate across West Africa. That’s the goal.

Also, expect more education. The SEC is planning public campaigns to help people spot scams. And more banks are starting to offer crypto-friendly services - but only for licensed partners.

This isn’t the end of the story. It’s the beginning of a new chapter. One where crypto in Nigeria isn’t about rebellion - it’s about responsibility.