The Nigerian government is taking significant steps to monitor citizens” cryptocurrency earnings through the implementation of the Nigeria Tax Administration Act (NTAA) 2025. Under this new regulation, which becomes effective on January 1, 2026, the authorities will utilize individuals” National Identification Number (NIN) and Tax Identification Number (TIN) to track and tax their crypto transactions.
As part of this initiative, Virtual Asset Service Providers (VASPs), including cryptocurrency exchanges, are required to submit monthly reports containing detailed information about users and their transactions. These reports must include data such as user names, addresses, contact details, transaction dates, and the types and values of digital assets involved. Any suspicious transactions must also be reported to the Nigerian Financial Intelligence Unit (NFIU) to combat potential money laundering and illegal activities.
The penalties for VASPs that fail to comply with these regulations are steep, starting with fines of ₦10 million ($7,026.57) for the first month of non-compliance, followed by ₦1 million ($702.66) for subsequent months, alongside the risk of losing their operating licenses.
Additionally, exchanges are mandated to keep customer records, including Know Your Customer (KYC) documentation, transaction logs, and identification data, for a minimum of seven years. Individuals involved in crypto trading are also required to maintain thorough records of their earnings and report them to tax authorities.
This legislation aligns with international standards, particularly the Organisation for Economic Co-operation and Development”s (OECD) Crypto-Asset Reporting Framework (CARF), which also takes effect in 2026. This framework aims to provide tax authorities with comprehensive information on both local and international crypto transactions, enhancing the government”s ability to monitor compliance and secure tax revenues.
Nigeria”s relationship with cryptocurrency has been tumultuous. The government previously imposed a ban on crypto trading in 2024 and restricted banks from engaging with crypto transactions back in 2021. However, despite these obstacles, the demand for cryptocurrencies has persisted, with Nigerians conducting substantial volumes of crypto transactions. The NTAA 2025 represents a pivotal effort to formalize this booming market and ensure that profits from digital assets are subject to taxation.
