Nigeria

Last Updated: June 2026

1. Legal Status

Nigeria's approach to crypto-assets and stablecoins has undergone a dramatic transformation — from an outright banking ban in 2021 to the enactment of comprehensive securities legislation in 2025 that explicitly recognizes digital assets. Stablecoins are not defined as a distinct legal category under Nigerian law but are classified based on their function: asset-backed stablecoins may be treated as securities under the Investments and Securities Act (ISA) 2025, while payment-focused stablecoins potentially fall under the regulatory scope of the Central Bank of Nigeria (CBN).

Nigeria launched cNGN, Africa's first regulated naira-backed stablecoin, in early 2025 under joint SEC and CBN supervision, marking a significant milestone in the regulatory acceptance of stablecoins in the continent's largest economy.

Crypto-assets, including stablecoins, are not recognized as legal tender. They are treated as property under the Finance Act 2023, and the FATF-aligned regulatory framework now explicitly includes virtual assets as subject to AML/CFT obligations.

2. Regulatory Framework

2.1 Multi-Regulator Architecture

Nigeria's stablecoin regulation involves multiple agencies with overlapping and complementary mandates:

2.2 Investment and Securities Act (ISA) 2025

The ISA 2025, enacted on 31 March 2025, is the landmark legislation that formally brought digital assets under regulatory oversight. It expands the definition of "securities" to explicitly include "virtual assets, digital assets and other distributed ledger technology (DLT) offers, tokens and products." This gives the SEC legal authority over the full spectrum of crypto-asset activities including stablecoin issuance.

Key provisions relevant to stablecoins:

• Stablecoin issuers must register as VASPs and comply with capital, governance, and disclosure requirements
• Both tokens and offerings must be registered with the SEC
• Platforms facilitating token offerings must be licensed as Digital Asset Offering Platforms (DAOPs)
• Advertising and promotion of unlicensed crypto products carries penalties of up to NGN 10 million in fines or three years imprisonment

Source: Chambers — Blockchain 2025 Nigeria

2.3 CBN Guidelines on VASP Banking (December 2023)

On 22 December 2023, the CBN issued the "Guidelines on Operations of Bank Accounts for Virtual Assets Service Providers (VASPs)", reversing the February 2021 banking ban that had prohibited financial institutions from facilitating crypto transactions. This circular allows banks to service SEC-licensed crypto firms under strict compliance conditions, reestablishing the banking rails essential for stablecoin operations.

The 2021 ban had directed all deposit money banks, non-bank financial institutions, and other regulated entities to immediately close accounts of individuals or companies involved in cryptocurrency transactions. The reversal represented a fundamental policy shift.

Sources: IBA — Nigeria Cryptocurrency Regulatory Landscape; Afriwise — CBN Lifts Ban

2.4 Regulatory Trajectory Timeline

3. Issuance Licensing

3.1 VASP Licensing Categories

The SEC regulates digital-asset activity through a set of registration categories established under the Rules on Issuance, Offering Platforms and Custody of Digital Assets (originally May 2022, with amendments under consultation since the September 2024 Exposure Draft):

3.2 Capital Requirements (Revised — SEC Circular No. 26-1, 16 January 2026)

On 16 January 2026 the SEC issued Circular No. 26-1, "Revised Minimum Capital for Regulated Capital Market Entities," which substantially raised minimum capital across digital-asset categories. The prior NGN 500 million floor that applied to exchanges has been superseded:

• Compliance deadline: affected entities must meet the revised thresholds by 30 June 2027. Failure to comply may result in suspension or withdrawal of registration, though the SEC may consider transitional arrangements case-by-case.
• The NGN 2 billion exchange/custodian threshold doubled the NGN 1 billion figure the SEC had floated during 2024 industry consultations.
• A stablecoin-specific issuer capital figure distinct from these category thresholds is NOT VERIFIED in public sources; stablecoin issuers are licensed under whichever activity category their function maps to (e.g. DAOP for issuance/offering).
• Fidelity Insurance Bond (minimum 25% of paid-up capital) and local incorporation with a resident CEO remained features of the SEC's exchange rules; whether the fidelity-bond percentage was altered by Circular No. 26-1 is NOT VERIFIED.

Sources: TechCabal — SEC NGN 2 billion minimum capital; Nairametrics — SEC raises crypto exchange capital to N2 billion; Chambers — Fintech 2026 Nigeria

3.3 Accelerated Regulatory Incubation Programme (ARIP)

Launched in June 2024, the ARIP serves as a regulatory sandbox providing provisional licenses for crypto startups to operate under SEC supervision while building compliance infrastructure. ARIP requirements include:

• Local incorporation with resident CEO
• Robust KYC/AML frameworks
• Quarterly reporting on user growth and financials
• Implementation of biometric onboarding
• Certain capital and conduct rules temporarily relaxed

By late 2024, the SEC awarded its first provisional approvals (approval-in-principle, AIP) to Busha Digital Limited and Quidax Technologies Limited through the ARIP. As of mid-2026, these two remain the only exchanges holding SEC provisional approval: the SEC publicly stated it was in "no rush" to issue further licenses, citing additional ("level-three") due diligence required after observing issues with early applicants, and — per the Chambers Fintech 2026 guide — did not admit any new VASP to the programme during 2025. The SEC's cNGN issuer (WrappedCBDC Limited) and several DAOPs/custodians (e.g. Trovotech, Dream City Capital, Blockvault) were admitted under the related Regulatory Incubation (RI) track rather than full ARIP approval.

Sources: Chambers — Fintech 2026 Nigeria; CoinGeek — Nigeria SEC in no rush to issue new licenses; Mondaq — Nigeria Stablecoin Regulation

3.4 Stablecoin Issuer Classification

Under the ISA 2025 and SEC amended rules, stablecoin issuers must:

• Register as VASPs and register both tokens and offerings with the SEC
• Comply with capital, governance, and disclosure requirements
• Provide detailed white papers outlining project scope, utility, risks, and governance
• Place assets with SEC-approved digital asset custodians
• Submit regular audited financial reporting and material event disclosures

The SEC employs a substance-over-form approach: classification depends on the stablecoin's economic function. Asset-backed stablecoins offering returns or ownership rights are treated as securities, while payment-focused stablecoins may fall under CBN oversight.

Source: Cryptoverse Lawyers — Nigeria ISA 2025

4. Reserve Requirements

4.1 General Stablecoin Reserve Standards

Under the SEC framework, stablecoin issuers must:

• Maintain verifiable reserves backing all issued tokens
• Undergo regular independent audits of reserve holdings
• Comply with transparent reserve management standards
• Report reserve composition and adequacy on a regular basis

4.2 cNGN Reserve Structure

The cNGN (compliant Naira) stablecoin maintains a 1:1 peg to the Nigerian Naira. Its reserve structure includes:

• Reserves held in commercial banks under SEC supervision
• Governed by WrappedCBDC Limited, a private entity (distinct from the CBN-issued eNaira)
• Designed for transparency and security of naira-denominated reserves

Sources: Monierate — cNGN Explained

5. AML/KYC

5.1 Legislative Framework

Virtual assets are explicitly included in the Money Laundering (Prevention and Prohibition) Act 2022. VASPs are classified as financial institutions for AML/CFT purposes, aligning with FATF Recommendation 15.

5.2 Mandatory Controls

All licensed VASPs and stablecoin issuers must implement:

• Customer due diligence (CDD) with biometric onboarding
• Suspicious transaction reporting to the Nigeria Financial Intelligence Unit (NFIU)
• Record-keeping compliance (minimum retention periods)
• Transaction monitoring systems
• Large payment reporting thresholds
• Sanctions screening

5.3 Enforcement Authority

The Special Control Unit Against Money Laundering (SCUML) has authority to suspend licenses or impose fines for AML/CFT non-compliance. The EFCC exercises parallel enforcement authority for financial crimes.

5.4 Foreign VASP Requirements

Entities targeting Nigerian investors must demonstrate:

• Home jurisdiction authorization
• Regulatory arrangements or cooperation agreements with Nigerian authorities
• Prior SEC approval for any advertising or promotion within Nigeria

Source: Chambers — Blockchain 2025 Nigeria

6. Taxation

6.1 Tax Treatment of Digital Assets (Nigeria Tax Act 2025 — effective 1 January 2026)

The taxation of crypto-assets, including stablecoins, was overhauled by the Nigeria Tax Act (NTA) 2025 and Nigeria Tax Administration Act (NTAA) 2025, both signed into law on 26 June 2025 and effective from 1 January 2026. This regime supersedes the earlier flat-rate approach that had applied under the Finance Act 2023.

• Definition: The NTA defines "digital assets" to include crypto assets, utility tokens, security tokens, NFTs and similar digital representations of value. Virtual assets held by Nigerian residents (or entities with a Nigerian permanent establishment) are deemed Nigeria-located for tax purposes.
• Chargeable gains — individuals: Profits from disposals of digital assets are treated as chargeable gains taxed at the personal income tax bands (0% up to 25%), not a flat rate. The first NGN 800,000 of annual income/gains is exempt; the top marginal rate of 25% applies to income above NGN 50 million. (This replaces the prior flat 10% CGT that had applied under the Finance Act 2023.)
• Companies / VASPs: Capital gains for companies are taxed at 30%; VASPs are subject to corporate income tax up to 30% on operating profits (small companies 0%).
• Scope: Applies to sales, swaps, spending, custody, issuance, mining, staking and any transaction where goods/services are paid for with virtual assets; valued at market price at the time of transaction. Stablecoin-to-stablecoin trades are taxable disposals.
• VAT: 7.5% VAT may apply to fees charged by VASPs for services rendered in Nigeria, but not on the crypto-assets themselves.

6.2 VASP Reporting and Information-Sharing (NTAA 2025)

• Monthly returns: Under Section 25 of the NTAA 2025, VASPs must file monthly transaction-level returns with the Nigeria Revenue Service / FIRS, including customer name, address, contact details, Tax ID and National Identification Number (NIN), plus the nature, dates, type, value and sale value of each digital-asset transaction.
• Identity harmonisation: From 1 January 2026, the NIN (individuals) and CAC registration number (companies) replace the traditional TIN as primary tax identifiers.
• CARF: Nigeria's adoption of the OECD Crypto-Asset Reporting Framework (CARF) took effect 1 January 2026, requiring exchanges to report user transaction data.
• Record retention: VASPs must retain customer transaction and identification records for at least seven years, and report large/suspicious transactions to tax authorities and the NFIU.

6.3 Penalties for Non-Compliance

• Businesses/VASPs: Up to NGN 10,000,000 in the first month of non-compliance, plus NGN 1,000,000 per month thereafter; persistent default may lead the SEC to suspend or revoke a VASP's license.
• FIRS utilizes KYC information from exchanges, inter-agency data sharing, NIN/CAC linkage and blockchain analysis to identify non-compliant taxpayers.

Sources: PwC — Nigeria Individual Significant Developments (NTA 2025); TechCabal — Nigeria crypto tax law VASP penalties 2026; Technext — How Nigeria plans to tax crypto from January 2026

7. Enforcement

7.1 Binance Enforcement Actions

The most significant crypto enforcement case in Nigeria involves Binance:

• September 2023: SEC directed Binance Nigeria to immediately cease soliciting Nigerian investors, describing its operations as "illegal"
• March 2024: Binance ended naira services amid allegations of exchange rate manipulation
• 2024: Two Binance executives were arrested in Nigeria
• 2024: CBN Governor Olayemi Cardoso stated that "$26 billion has passed through Binance Nigeria from sources and users we cannot adequately identify"
• Ongoing: FIRS filed tax evasion charges against Binance (case FHC/ABJ/CS/1444/2024), alleging failure to pay VAT and corporate income tax, and aiding customer tax avoidance; the suit seeks ~USD 2 billion in back taxes (2022–2023) plus USD 79.51 billion in claimed economic-loss damages
• March 2026: Binance formally requested an out-of-court settlement (24 March 2026) before the Federal High Court, Abuja, after the prosecution had presented four witnesses; Justice Emeka Nwite adjourned the matter to allow settlement talks
• May 2026: With negotiations ongoing, the court (12 May 2026) further adjourned the matter to 9 July 2026 for a progress report on settlement, with no final ruling or settlement agreement reached as of June 2026

7.2 Other Enforcement

• SEC crackdown on fraudulent Ponzi schemes using digital assets
• 2024 account freezes by authorities targeting cryptocurrency-linked forex abuse
• The enforcement actions sent a strong signal about the regulatory perimeter while creating uncertainty for unregistered and offshore platforms

Sources: Mariblock — Binance Timeline; Vanguard — Court adjourns FG's suit against Binance for report of settlement; Daily Post — Court adjourns Binance tax evasion case for settlement talks; The Africa Report — Nigeria Crypto Comeback

8. Recent Developments (2024–2026)

8.0 Developments since March 2026

• 16 January 2026 — SEC Circular No. 26-1: SEC raised minimum capital across digital-asset categories (DAX/custodians to NGN 2 billion, DAOPs/RATOPs to NGN 1 billion), with a 30 June 2027 compliance deadline (see Section 3.2). Sources: TechCabal; Nairametrics
• 1 January 2026 — New tax regime in force: The Nigeria Tax Act 2025 and Nigeria Tax Administration Act 2025 took effect, replacing the flat 10% CGT with chargeable gains at PIT bands (up to 25%), introducing Section 25 monthly VASP returns, NIN/CAC tax-ID harmonisation, and OECD CARF adoption (see Section 6). Source: PwC — Nigeria significant developments
• 24 March – 12 May 2026 — Binance settlement track: Binance sought an out-of-court settlement in the FIRS tax suit; the Federal High Court adjourned the matter to 9 July 2026 for a settlement progress report (see Section 7.1). Source: Vanguard
• February 2026 — CBN Fintech Strategy Report: The CBN proposed a "Single Regulatory Window" to coordinate licensing across agencies and to expand the regulatory sandbox (AI, cross-border payments, embedded finance) on a "test-then-codify" basis — relevant to the multi-regulator coordination challenge for stablecoins. Source: Chambers — Fintech 2026 Nigeria

8.1 cNGN Stablecoin Launch

cNGN (compliant Naira) launched under SEC and CBN supervision in February 2025 as Africa's first regulated stablecoin, after its issuer WrappedCBDC Limited was admitted to the SEC's regulatory incubation (ARIP/RI) track on 29 August 2024 — admission to test, not an Approval-in-Principle (the only AIPs granted that day went to Busha and Quidax):

• Peg: 1:1 to the Nigerian Naira
• Issuer: WrappedCBDC Limited (private entity), backed by the Africa Stablecoin Consortium (a consortium of Nigerian banks, fintechs and blockchain firms)
• Use cases: Instant payments, cross-border remittances, DeFi/GameFi transactions, naira-denominated digital commerce
• Distribution: Purchased and sold via licensed local exchanges (Busha, Quidax)
• Relationship to eNaira: Complementary — cNGN is a private-sector stablecoin, while eNaira is the CBN's CBDC
• Adoption concerns: Industry commentary through 2025–2026 has flagged limited exchange uptake and the absence of continuous, verifiable proof-of-reserve / attestation, which observers say creates a trust deficit. Sources: TechCabal — what cNGN means; Techpoint — cNGN criticism and questions

8.2 eNaira CBDC Interaction

The eNaira, Nigeria's CBDC launched in October 2021 by the CBN, has experienced limited adoption. Regulatory sources indicate the eNaira may soon link to licensed VASPs, offering a smoother fiat-crypto bridge. The cNGN is designed to complement rather than substitute the eNaira, with the two instruments serving different purposes in Nigeria's digital financial ecosystem.

8.3 National Blockchain Policy

NITDA released a National Blockchain Adoption Strategy and the National Blockchain Policy (May 2023). In July 2024, NITDA announced plans for "Nigerium", an indigenous blockchain platform addressing concerns about foreign-dominated global infrastructure. The Federal Ministry of Communications and Digital Economy released a comprehensive White Paper on National Blockchain Policy in 2025.

8.4 Zone Blockchain Partnership

In August 2024, the Nigeria Inter-Bank Settlement System (NIBSS) partnered with Zone's Blockchain Network to enable real-time, decentralized POS transactions. Zone POS processed over NGN 1 trillion in transactions as of June 2024.

Sources: Lucidity Insights — cNGN Regulatory Approval; Ledger Insights — cNGN Launch; Plasma — Nigeria Stablecoins

9. Assessment

Regulatory maturity: EMERGING-TO-MODERATE — Nigeria has enacted comprehensive legislation (ISA 2025) and launched a regulated stablecoin (cNGN), but implementation is still evolving and multi-regulator coordination remains a challenge.

Strengths:

• Landmark ISA 2025 provides clear legal basis for digital asset regulation
• cNGN demonstrates practical stablecoin regulation in action
• ARIP sandbox enables controlled innovation
• Large market: Nigeria is Africa's largest economy with massive stablecoin demand
• Clear regulatory trajectory from ban to structured licensing

Weaknesses:

• Multi-regulator overlap creates coordination challenges (SEC, CBN, FIRS, EFCC); the CBN's February 2026 proposal for a "Single Regulatory Window" is an early attempt to address this
• High capital requirements (raised to NGN 2 billion for exchanges/custodians under Circular No. 26-1, from NGN 500 million) may force consolidation and exclude smaller startups
• Full implementation of ISA 2025 provisions still ongoing
• Stablecoin classification remains somewhat ambiguous (securities vs. payment instruments)
• Infrastructure gaps: inconsistent electricity, limited internet in rural areas
• Enforcement approach has been uneven (aggressive toward Binance, accommodating toward local operators)

Comparison: Nigeria's approach contrasts with the

Related coverage

Nigeria in other research domains:

• CBDC Frameworks
• DeFi Regulation & Liability Frameworks
• Digital Asset License Map
• Digital Asset Taxation
• Payment Services & Crypto Payment Regulation

Verification Notes

Refresh of 4 June 2026. This document was refreshed against primary and high-authority sources on 4 June 2026; the original verification of 18 March 2026 is retained below.

Corrections made in the 4 June 2026 refresh (Correction Protocol):

1. Exchange capital requirement (was NGN 500 million → now NGN 2 billion). The file previously stated DAX minimum paid-up capital of NGN 500 million. SEC Circular No. 26-1 (16 January 2026) raised this to NGN 2 billion for exchanges and custodians, NGN 1 billion for DAOPs and RATOPs, NGN 500 million for DAIs/DAPOs and NGN 300 million for ancillary VASPs, with compliance by 30 June 2027. Corrected in Section 3.2, Assessment, and Recent Developments. Verified via TechCabal (16 Jan 2026) and Nairametrics (16 Jan 2026).
2. Crypto taxation (was flat 10% CGT → now chargeable gains at PIT bands up to 25%). The file previously stated a flat 10% CGT under the Finance Act 2023. The Nigeria Tax Act 2025 (signed 26 June 2025, effective 1 January 2026) replaced this: individuals' digital-asset disposals are now chargeable gains taxed at personal income tax bands (0%–25%, first NGN 800,000 exempt); companies/VASPs at up to 30%. Corrected in Section 6. Verified via PwC Tax Summaries (Nigeria significant developments) and corroborating Nigerian outlets.
3. NTAA 2025 monthly VASP returns. Added the Section 25 monthly transaction-level reporting obligation, NIN/CAC tax-ID harmonisation, and OECD CARF adoption (all effective 1 January 2026). Verified via TechCabal and Technext.
4. cNGN regulatory status corrected. Independent verification (4 June 2026) established that on 29 August 2024 the SEC granted Approval-in-Principle only to Busha and Quidax; cNGN's issuer WrappedCBDC Limited was admitted to test under the regulatory incubation (ARIP/RI) track, not granted an AIP. The prior "cNGN received AIP" wording was inaccurate (and contradicted §3.3 of this file). cNGN publicly launched February 2025. Sources: Infusion Lawyers — SEC AIP for ARIP applicants (2 Sep 2024); Mariblock.
5. Binance enforcement update. Added the USD 79.51 billion economic-loss claim and the March–May 2026 out-of-court settlement track (adjourned to 9 July 2026). Verified via Vanguard (May 2026) and Daily Post (12 May 2026).
6. Licensing status. Noted that Busha and Quidax remain the only ARIP provisional approvals and that no new VASP was admitted in 2025 (SEC "no rush" stance). Verified via Chambers Fintech 2026 and CoinGeek.

Items NOT VERIFIED in the 4 June 2026 refresh:

• A stablecoin-issuer-specific minimum capital figure distinct from the general category thresholds — no public figure located; stablecoin issuers map to the relevant activity category (e.g. DAOP).
• Whether SEC Circular No. 26-1 altered the 25%-of-paid-up-capital fidelity-bond requirement — not stated in available reporting.
• Final disposition of the Binance settlement (pending as of June 2026; next court date 9 July 2026).

Original verification (18 March 2026): All claims were verified through web searches and source document review conducted on 18 March 2026. Key verification points:

1. ISA 2025 enactment date (March 31, 2025): Verified via Chambers Practice Guide, Andersen Nigeria analysis, and multiple legal commentaries.
2. CBN banking ban reversal (December 22, 2023): Verified via IBA overview, Afriwise analysis, and multiple independent sources.
3. cNGN launch and structure: Verified via Wikipedia, Monierate, Ledger Insights, and Lucidity Insights reporting.
4. NGN 500 million capital requirement: Verified via Chambers Practice Guide and TechCabal analysis.
5. 10% CGT rate: Verified via Cointelegraph, PwC Finance Act 2023 analysis, and West Africa Trade Hub guide.
6. Binance enforcement timeline: Verified via Mariblock and Techpoint Africa detailed timeline articles.
7. ARIP program and Busha/Quidax licenses: Verified via Chambers Practice Guide and The Africa Report.
8. eNaira-cNGN relationship: Verified via Plasma and academic papers (MPRA Munich).
9. Zone blockchain/NIBSS partnership: Verified via Chambers Practice Guide.
10. Nigerium initiative: Verified via Chambers Practice Guide and NITDA announcements.

Limitations: The SEC's specific stablecoin issuer capital requirements (distinct from exchange requirements) were not precisely identified in publicly available sources. The ISA 2025's full implementing regulations were still being developed at the time of research. Tax enforcement data specific to stablecoin transactions (rather than crypto generally) was not available.