…From declining global adoption rankings to rising compliance costs and taxation concerns, FlashChange’s recent webinar examines what it will take to build a competitive digital asset industry in Nigeria.
Nigeria’s cryptocurrency industry faces a defining question: how can a country with strong grassroots adoption of digital assets create an environment where legitimate businesses can thrive, attract investment and compete globally?
This question took centre stage at a recent webinar hosted by FlashChange, the Nigerian digital asset platform, themed “Beyond the Framework: The Realities of Building Crypto in Nigeria.”
The session brought together industry stakeholders to examine the practical challenges of operating cryptocurrency businesses, including regulatory requirements, taxation, compliance costs and the need for proportionate policies that encourage innovation while protecting consumers.
Obinna Iwuno, Chief Executive Officer of CBC Blockchain Services, delivered the keynote address. The panel featured Olabode Ezekiel, a Tax Expert, and Chiemeka Ohiajionu, Partner at Ducrest, while Nuratulahi Yishawu, Legal and Compliance Officer at FlashChange, moderated the session.
Their contributions highlighted the need to move beyond regulatory frameworks on paper and address the commercial realities determining whether Nigerian cryptocurrency businesses can survive, scale and compete internationally.
Nigeria’s adoption paradox
One of the webinar’s key takeaways was Nigeria’s reported decline from second to sixth place in global cryptocurrency adoption rankings. The development raised concerns about the country’s ability to translate strong retail participation into a sustainable, institutionally supported digital asset ecosystem.
While Nigerians continue to use cryptocurrency for digital transactions and cross-border payments, the webinar highlighted the importance of creating conditions that encourage institutional participation and long-term investment.
The United States offers a useful comparison, with regulated investment products and growing institutional involvement contributing to its prominence in the digital asset market.
For Nigeria, the lesson is not to replicate another country’s model wholesale, but to establish clear and predictable rules that enable responsible businesses to innovate, attract investment and compete globally.
Retail adoption remains valuable, but widespread usage alone cannot guarantee industry growth. Without viable operating conditions, local businesses may struggle to develop the partnerships, infrastructure and products needed to compete internationally.
The high cost of compliance
A major concern raised during the webinar was the financial burden of regulatory compliance on virtual asset service providers (VASPs).
Cryptocurrency businesses must invest in transaction monitoring, anti-money laundering controls, cybersecurity, and customer verification and reporting systems. Although these measures are essential, the associated costs can be particularly challenging for smaller operators.
Panelliss cited blockchain intelligence tools such as Chainalysis, reportedly costing as much as $40,000 annually, as an example of the financial pressure facing businesses. They also questioned the impact of the Securities and Exchange Commission’s ₦2 billion minimum capital requirement for digital asset exchanges.
For established businesses, such requirements may strengthen operational resilience. For smaller operators and new entrants, however, they could create substantial barriers to entry, restrict competition and concentrate market opportunities among a few well-capitalised companies.
The webinar therefore emphasised the importance of proportionate regulation—an approach that considers the scale, activities and risk profiles of businesses when determining compliance obligations.
The objective should be to maintain strong consumer protection without making regulatory compliance prohibitively expensive for legitimate operators.
Taxation and the question of fairness
Taxation emerged as another critical issue, particularly regarding its potential impact on business competitiveness and consumer participation.
The panellists raised concerns about a cited 1.5 per cent stamp duty on cryptocurrency transactions compared with 0.5 per cent for traditional financial services. They argued that such a disparity could place compliant digital asset platforms at a disadvantage. If transaction costs become excessive, users may be discouraged from using regulated platforms, potentially undermining efforts to promote transparency and accountability.
Against this backdrop, the Nigeria Revenue Service’s review of its released guidelines presents an opportunity to address industry concerns and strengthen the framework for taxing virtual assets. There is hope that the revision will better reflect the realities of Nigeria’s digital asset ecosystem, including the high cost of compliance, the need for fair tax treatment and the importance of maintaining a competitive environment for legitimate operators.
A balanced approach would provide clearer guidance, predictable obligations and equitable treatment of comparable transactions, helping businesses plan effectively while supporting government revenue objectives.
Ultimately, taxation should promote accountability without unnecessarily discouraging innovation, increasing the cost of participation or undermining the competitiveness of compliant Nigerian businesses. The ongoing review offers an opportunity to strike that balance and build greater confidence between tax authorities and the digital asset industry.
Lessons from South Africa
The webinar also examined South Africa’s cryptocurrency regulatory environment as a comparative example.
The panellists cited more than 200 licensed crypto businesses in South Africa, compared with 14 in Nigeria, arguing that proportionate entry requirements could help Nigeria encourage wider participation and strengthen competition.
Although licensing figures alone cannot explain the differences between the two markets, the comparison raises important questions about accessibility, regulatory efficiency and business development.
Nigeria could benefit from clearer licensing processes, practical compliance guidance, predictable timelines and capital requirements proportionate to the risks associated with different business activities.
Such measures would not weaken oversight. Rather, they could help legitimate operators meet regulatory expectations while creating room for responsible innovation and competition.
Beyond the framework
The perspectives shared by Iwuno, Ezekiel and Ohiajionu, under Yishawu’s moderation, underscored the interconnected nature of the challenges facing Nigeria’s digital asset industry. Blockchain innovation cannot be separated from taxation, legal certainty, compliance and the realities of running a sustainable business.
By convening the discussion, FlashChange provided a platform for examining these challenges and encouraging engagement among industry stakeholders.
The webinar’s central message was clear: Nigeria’s cryptocurrency industry needs more than widespread retail adoption. It needs a regulatory environment that supports institutional participation, a fair and predictable tax framework, and compliance requirements that protect consumers without shutting out credible businesses.
For the country to strengthen its global competitiveness, regulators and industry operators must work towards practical solutions that balance innovation, accountability and commercial sustainability.
Nigeria still has considerable potential to develop a vibrant digital asset ecosystem. Realising that opportunity will depend on translating policy into workable conditions for businesses and building public trust through responsible operations.
Ultimately, the choice is not between regulation and innovation. Nigeria’s challenge is to create an environment where both can thrive, enabling local cryptocurrency businesses to grow sustainably and compete on the global stage.
