Nigeria Recognizes Cryptocurrencies as Securities in 2025, Boosting Adoption

Nigeria, a country that has historically ranked high in terms of crypto adoption, has made significant strides in regulating digital assets. In 2025, the Nigerian government has established a comprehensive regulatory framework that recognizes cryptocurrencies as securities. This shift allows individuals to use crypto as a medium of exchange for goods and services, provided they comply with the country's digital asset regulations.

In June 2025, the Securities and Exchange Commission (SEC) released new digital asset rules, granting it authority over crypto asset service providers and platforms. These rules came into effect after the SEC was authorized in March of the same year. However, the licensing process for virtual asset service providers (VASPs) was delayed due to additional due diligence requirements, as outlined by Director General Emomotimi Agama. This delay was part of the SEC's efforts to create a more structured crypto ecosystem in Nigeria.

On March 29, 2025, President Bola Ahmed Tinubu signed the Investments and Securities Act (ISA) 2025 into law. This legislation classifies cryptocurrencies and other digital assets as securities, thereby bringing them under the purview of the SEC. The law also mandates that VASPs, digital asset operators (DOPs), and digital asset exchanges (DAEs) register and obtain authorization from the SEC. Despite this recognition, national banks retain the authority to restrict transactions involving digital assets.

The Nigerian government aims to foster innovation while ensuring security through its new crypto regulations. By aligning with global standards and encouraging the use of blockchain technology, Nigeria seeks to enhance economic prosperity, efficiency, innovation, transparency, security, and trust. The country is also focusing on talent development and blockchain development to drive innovation.

Under Section 357 of the ISA 2025, virtual assets are legally defined as securities, making it mandatory for VASPs to obtain a license and comply with anti-money laundering (AML) and know your customer (KYC) obligations. This requirement applies to both foreign and local VASPs, including exchanges, wallets, DeFi front ends, token platforms, and custodians. The new rules have significant implications for various stakeholders, including retail users, developers, businesses accepting crypto, and foreign exchanges.

Cryptocurrencies are subject to taxation in Nigeria under the new ISA law. Taxable events include selling, trading, spending crypto, receiving crypto as payments, mining, staking, masternodes, airdrops, and hard forks. Non-compliance with tax regulations can result in penalties, so individuals are advised to stay updated on developments from the Federal Inland Revenue Service (FIRS) and the SEC, maintain accurate records of crypto transactions, and seek professional advice if necessary. The tax rates for capital gains, income tax, and VAT vary depending on the type of transaction and platform fees.

Nigeria's crypto adoption rate is among the highest globally, with nearly one-third of the population using crypto. The penetration rate is projected to reach 11.66% in 2025 and 11.83% by 2026. The current crypto revenue in Nigeria is expected to reach US$2.4 billion, with an annual growth rate of 3.46%, resulting in a projected revenue of US$2.5 billion by 2026. The government's focus is on emerging technologies rather than holding crypto assets.

In conclusion, Nigeria has made a significant leap in the digital assets domain by recognizing cryptocurrencies as securities. The government's efforts to increase crypto adoption and user rates, coupled with a focus on innovation and security, position Nigeria to accelerate its economic power in the coming years.