Nigeria, a global leader in peer-to-peer cryptocurrency trading, has initiated sweeping financial reforms mandating that virtual asset service providers (VASPs) and crypto exchanges must strictly integrate user identification via Tax Identification Numbers (TINs) or the National Identification Number (NIN) into their operational compliance protocols.
This regulatory overhaul, driven primarily by the Central Bank of Nigeria (CBN) and the Securities and Exchange Commission (SEC), aims to achieve two critical objectives: significantly bolster Anti-Money Laundering (AML) and Combating the Financing of Terrorism (CFT) efforts, and expand the national tax base by capturing capital gains derived from digital asset trading.
The directive signals the government’s pivot from previous unofficial restrictions—such as the 2021 ban on banks facilitating crypto transactions—to structured regulation and integration. Under the new VASP guidelines, licensed exchanges are required to maintain meticulous records, linking transaction history and wallet holdings directly to verified national IDs.
Financial analysts suggest that the move is an inevitable step towards formalizing the country’s massive crypto economy. By requiring stringent KYC procedures linked to verifiable national registries, authorities gain enhanced oversight, effectively reducing the sector’s historical anonymity. Failure by VASPs to comply could result in heavy sanctions or license revocation, while users face the expectation of increased financial transparency and eventual taxation on trading profits, bringing the crypto sphere in line with traditional financial reporting standards.
Source: Nigeria ties crypto oversight to tax IDs under sweeping reform
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