.
Nigeria’s cryptocurrency ecosystem has grown to a scale that is increasingly difficult for policymakers to overlook, with rising adoption of digital assets prompting a decisive shift from restrictive policies to a more structured regulatory framework.
What was once dominated by informal over-the-counter (OTC) transactions is rapidly evolving into a regulated financial ecosystem where cryptocurrency exchanges and virtual asset service providers (VASPs) are expected to operate under licensing, tax, and compliance requirements.
A key driver of the country’s crypto adoption remains the widespread use of U.S. dollar-backed stablecoins, particularly USDT and the increasingly popular USDC. For many Nigerians, these digital assets have become practical tools for preserving value against inflation, receiving payments from international clients, facilitating cross-border transactions, and safeguarding savings from the volatility of the naira.
Industry data cited in the report indicates that Nigeria processed approximately $92.7 billion in on-chain cryptocurrency transactions within a year, reinforcing its position as the largest crypto market in Sub-Saharan Africa. Of that figure, about $57 billion came from retail transactions, while an estimated 26.3 million Nigerians roughly one-quarter of the country’s adult population actively own or transact with digital assets.
Beyond dollar-backed stablecoins, local blockchain developers and fintech firms are also exploring naira-backed stablecoins, including cNGN, as a way to improve domestic payment settlements while remaining compliant with regulations set by the Central Bank of Nigeria (CBN).
The rapid expansion of the market has coincided with a notable policy shift by the Federal Government. Rather than pursuing broad restrictions on cryptocurrency activities, authorities are increasingly embracing a framework centered on regulation, licensing, and taxation.
To support that transition, President Bola Tinubu approved the establishment of the Virtual Asset Council (VAC), bringing together the Central Bank of Nigeria (CBN), the Securities and Exchange Commission (SEC), and the Nigeria Revenue Service (NRS). The council is expected to coordinate oversight of the digital asset sector, strengthen compliance, combat illicit financial activities, and ensure operators meet regulatory standards.
The report notes that the government’s evolving approach reflects the practical realities of regulating a rapidly growing industry. Rather than attempting to monitor millions of peer-to-peer traders individually, regulators are placing greater emphasis on supervising licensed exchanges and VASPs, enabling authorities to collect licensing fees, tax revenues, and transaction reports from registered operators.
In line with the new framework, the SEC now requires cryptocurrency exchanges offering trading and custody services to obtain VASP licences. Local platforms participating in the regulatory initiative, including Quidax and Busha, also require users to complete Know Your Customer (KYC) procedures using their Bank Verification Number (BVN) and other identity documents before accessing services.
The report further highlights that capital gains tax is expected to apply to profits generated from the trading and disposal of digital assets under Nigeria’s updated tax regime. While international exchanges such as Binance, Bybit, and OKX remain popular among Nigerian users, tighter compliance requirements have made converting crypto assets to local currency through regulated channels more demanding.
As Nigeria’s digital asset market matures, stablecoins are increasingly being viewed not merely as speculative investments but as essential financial tools embedded in everyday commerce. The country’s regulatory direction suggests that government attention is now focused on integrating cryptocurrencies into the formal financial system while ensuring transparency, consumer protection, and tax compliance rather than attempting to suppress their adoption.
