Nigeria has activated a identity-based cryptocurrency supervision framework under the Nigeria Tax Administration Act (NTAA) 2025, requiring all virtual asset service providers (VASPs) to link transactions to Tax Identification Numbers (TIN) and National Identification Numbers (NIN). The rule takes immediate effect.
VASPs must submit periodic reports to tax authorities detailing customer names, contact information, and tax IDs. Individual users are required to provide NINs, while businesses use TINs. Providers must also flag large or suspicious transactions to financial intelligence units, extending anti-money laundering protocols to crypto operations.
Shifting Away from Costly Blockchain Surveillance
Nigeria first imposed a tax on crypto profits in 2022, but enforcement faltered due to the difficulty of associating trades with identifiable taxpayers. The new approach taps into existing tax and identity databases rather than deploying expensive blockchain analytics tools. Regulators gain a low-cost method to track crypto activity without building complex on-chain infrastructure.
Industry observers note this model suits developing economies: instead of investing in sophisticated surveillance technology, governments can leverage national ID systems to enforce tax compliance on digital assets.
Aligning with the OECD's CARF Framework
Nigeria’s reforms follow the OECD’s Crypto-Asset Reporting Framework (CARF), which took effect globally on January 1, 2025, with full implementation expected by 2028. By adopting CARF-compatible rules, Nigeria positions itself within an international network for automatic tax information exchange on crypto transactions.
Penalties for non-compliance remain unspecified in the act, but VASPs are required to verify identity during account opening, transaction execution, and withdrawals. The first reporting deadline is likely set for Q4 2026. Nigeria’s central bank has historically restricted crypto trading, but this move signals a shift from outright prohibition to a regulatory middle ground that prioritizes tax collection over blanket bans.