Nigeria Sets Up Virtual Asset Council to Tighten Crypto Oversight

Nigeria's President Bola Tinubu has signed an executive order creating a coordinated oversight framework for digital assets, aiming to close long-running regulatory gaps in the country's fast-growing crypto market while leaving existing regulators' statutory powers intact. Crypto use has accelerated sharply. The IMF estimates roughly $59 billion in cryptoasset inflows to Nigeria between July 2023 and June 2024, and says the country has accounted for about 60% of stablecoin inflows into sub-Saharan Africa since 2019. Stablecoins are widely used by households and small businesses for remittances, cross-border payments and hedging currency risk, though regulators say the pace of growth is straining monetary and supervisory systems. The order does not create a new standalone watchdog. Instead, it establishes a virtual asset council led by senior financial regulators to coordinate policy and supervision across agencies responsible for banking, securities, taxation and financial crime. Each regulator retains its independence and existing mandate. The framework adopts an activity-based registration model, meaning firms will be registered and regulated based on the services they provide—such as exchanges, payment services or investment platforms—and the types of assets involved. The stated aim is to eliminate loopholes that let some unregistered operators fall between agency jurisdictions and avoid supervision. The presidency said the framework is designed to protect users from fraud, support responsible innovation and safeguard financial stability. On taxation and reporting, the Nigerian Revenue Service (NRS) will issue guidance on how the order affects taxpayers. The executive order does not introduce new tax rates, but it brings digital-asset tax enforcement into the coordinated oversight structure. Reporting rules are already being implemented: since early 2026, crypto service providers have been required to link transactions to tax identification numbers—and, in some cases, national ID numbers—under the Nigeria Tax Administration Act 2025. Nigeria's approach aligns with the OECD's Crypto-Asset Reporting Framework (CARF), effective Jan. 1, 2026, which supports cross-border information sharing on crypto transactions. The executive action comes alongside legislative work in parliament. In June, the Senate advanced the Virtual Asset Service Providers Regulation Bill, 2026 (SB 956) at second reading. The bill would set licensing, transparency and compliance requirements for exchanges and other virtual asset businesses serving Nigerian users. SB 956, sponsored by Deputy Senate President Barau Jibrin and presented during debate by Senate Chief Whip Mohammed Monguno, has been sent to the Senate Committee on Capital Market for review, amendments and public input. It still requires committee approval, a third reading and additional legislative steps before becoming law. Key items to watch include forthcoming NRS guidance on tax treatment and reporting, how the virtual asset council translates coordination into concrete registration and supervision requirements for exchanges, wallets and payment providers, and changes that may emerge from the Senate committee process that could affect licensing standards, consumer protections and compliance costs. Tinubu's order signals a coordination-first strategy intended to curb regulatory arbitrage while preserving each agency's mandate. For crypto firms and users, it points to clearer rules and tighter oversight; for policymakers, it is an attempt to balance innovation in cross-border payments with risks flagged by the IMF.