The Federal Government has lifted the ban imposed on cryptocurrency trading in Nigeria and introduced taxes to enhance revenue generation and support innovation.
The Central Bank of Nigeria (CBN) had previously issued a circular in February 2021, instructing financial institutions to close accounts associated with cryptocurrency transactions. The ban was prompted by concerns over money laundering, terrorism financing, cybercrime, and the volatile nature of cryptocurrencies.
However, the move faced widespread criticism from the public and the cryptocurrency community, who viewed it as an obstacle to progress and economic growth.
In a surprising turn of events, the Nigerian government has now taken a different stance, by lifting the ban and introducing cryptocurrency taxation.
The decision aligns Nigeria with other global jurisdictions that have implemented taxation on cryptocurrencies, including the United Kingdom, the United States, Australia, India, Kenya, and South Africa.
The introduction of taxation on cryptocurrencies was included in the latest finance bill, signed into law by President Muhammadu Buhari on May 28, 2023. The law imposes a 10 percent tax on gains from the disposal of digital assets, including cryptocurrencies. It becomes effective as of May 1, 2023.
