SEC Moves to Tax Cryptocurrency Transactions in Nigeria
The Nigeria Securities and Exchange Commission (SEC) has announced amendments to regulations that will bring cryptocurrency trading and digitised transactions under the formal tax net.
According to a Bloomberg report on Tuesday, the SEC confirmed in an emailed statement that the new measures are designed to ensure all eligible transactions on regulated exchanges are taxed, though it did not specify the expected revenue figures.
The SEC also revealed plans to expand the scope of crypto licensing, including issuing permits that will allow residents to trade on centralised exchanges.
These platforms will enable the monitoring and taxation of transactions, providing greater transparency and security for investors. “We anticipate gradual traction toward centralized exchanges because they will offer greater protections and comfort for investors,” the regulator stated.
This development aligns with global trends toward regulating the cryptocurrency market and follows similar steps taken by Nigeria’s Central Bank (CBN).
In December 2023, the CBN issued operational guidelines for virtual asset service providers (VASPs) to banks and other financial institutions, marking a shift from its earlier stance that restricted cryptocurrency transactions.
In February 2021, the CBN had directed deposit money banks and financial institutions to close accounts involved in crypto transactions.
The push to tax digital assets gained momentum in December 2022 when former Finance Minister Zainab Ahmed announced that the 2022 Finance Bill included provisions for taxing cryptocurrencies and other digital assets.
The SEC’s latest move builds on this foundation, with 50 cryptocurrency exchanges already applying for operational licenses in Nigeria as of September 12, 2024, according to SEC Director-General Emomotimi Agama. #SEC Moves to Tax Cryptocurrency Transactions in Nigeria
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