Nigeria has begun enforcing a groundbreaking tax and regulatory regime that ties cryptocurrency transactions to individual identities, marking a major shift in how digital assets are tracked, taxed, and regulated in the country.
Under the Nigeria Tax Administration Act (NTAA) 2025, which took effect on January 1, 2026, Virtual Asset Service Providers (VASPs) — including crypto exchanges and wallet services — are required to collect and report identity information for users and their transactions.
This identity-linked oversight framework puts Nigeria at the forefront of next-generation crypto regulation: it integrates Tax Identification Numbers (TINs) and National Identification Numbers (NINs) directly into digital asset reporting, enabling authorities to match crypto activity with real-world tax records without attempting to breach blockchain privacy.
How It Works: Linking Crypto to Identity
Under the new rules:
- VASPs must collect customer identity details — including names, contact information, addresses, TINs, and NINs — for every user.
- Monthly reports must be submitted to the Nigeria Revenue Service (NRS) with detailed transaction data, including the type and value of assets transacted.
- Providers are required to flag large or suspicious transactions to the Nigerian Financial Intelligence Unit (NFIU) as part of broader anti-money-laundering (AML) efforts.
- All customer records and transaction histories must be retained for at least seven years to ensure auditability and enforcement.
This system allows tax authorities to bridge the gap between digital asset flows and formal tax compliance, addressing long-standing challenges in tracking crypto profits outside traditional financial systems.
See more related: Nigeria to Tax Individual Crypto Gains Starting 2026
Why This Matters
Nigeria is one of the world’s largest crypto markets in terms of transaction volume — more than $90 billion flowed through the ecosystem in the year ending June 2025. Despite the size of activity, much of it has historically occurred outside formal tax and regulatory oversight, complicating enforcement and revenue collection.
By tying crypto activity to real-world identifiers, Nigeria’s tax regime:
- Enhances transparency in an otherwise opaque sector
- Reduces tax evasion risks by matching digital income against reported earnings
- Aligns with global standards set by the OECD’s Crypto-Asset Reporting Framework (CARF) that came into force on January 1, 2026
This is a major step in bringing digital assets into the formal economy without undermining blockchain security or requiring invasive technical surveillance of decentralized systems.
What Crypto Users and Platforms Should Know
For individual traders, investors, and crypto businesses:
- Expect stricter onboarding requirements with identity verification tied to tax IDs
- Exchanges may delay withdrawals or account access until proper documentation is provided
- Failure to comply with reporting and retention rules can lead to financial penalties and enforcement actions
While this shift increases compliance obligations, it also creates a clearer regulatory path for legitimate crypto activity in Africa’s largest economy.
