Nigeria’s $92 billion virtual asset market, built overwhelmingly by young Nigerians and now the largest in Sub-Saharan Africa, risks being driven offshore by the new guidelines on the taxation of virtual assets, a pressure group, the Digital Assets Coalition, has warned.
In its formal position paper on the framework of the new guidelines, which came into force on 3 August 2026, the Coalition, at the weekend, objected to the charges on the gross movement of money rather than on any profit earned.
The industry alliance representing digital-asset participants and operators in Nigeria, opens the paper, titled: ‘Tax the Profit, Not the Movement of Money’, with an unambiguous statement of support for taxation.
However, it said it backs taxing real gains, registering platforms, verifying customers, and requiring full transaction reporting, in line with the standards of the United Kingdom, South Africa, and Brazil.
It said it is objecting to the charges on the gross movement of money rather than on any profit earned.
The first, it said, is a 1.5% stamp duty on every conversion between naira and digital assets, never refunded and charged whether a person gains or loses. The second is a 1% withholding deducted from the entire value of every sale, even where the seller made a loss.
A third concern is the requirement to remit taxes in tokens, which is inconsistent with the Nigeria Tax Administration Act, 2025, whose Section 39 mandates payment in currency.
‘We support the taxation of virtual assets without qualification,’ said Obinna Iwuno, spokesperson of the Digital Assets Coalition.
‘Our concern is with a design choice that taxes the movement of money itself. This charge falls on a remittance to a student abroad, on a freelancer converting earnings already taxed as income, and on a trader in a year they lost money. That is not a tax on profit. It is a toll on participation.’
Daily Trust reports that the burden falls hardest on the young Nigerians who built the market as working infrastructure for global earnings, family remittances, and savings that survive Naira volatility.
Because young users transact small and often, the levies compound fastest against their pattern of use.
They bite even below the N10 million threshold the Nigeria Tax Act itself exempts and within the N800,000 income band taxed at zero, while filing burdens can exceed a student’s entire earnings.
‘The framework is anti-youth in effect, even if not in intent,’ Iwuno said, adding, ‘You cannot tax your way into the future by taxing the people building it.’
Every comparable country has reversed course. India’s 1% transaction withholding saw regulated exchanges lose 81% of volume within four months, with over 90% of trading moving offshore within a year, according to the Esya Centre.
Kenya repealed its 3% transaction tax in 2025, and Turkey withdrew a similar levy in 2026.