Crypto tax could drive Nigerians to offshore platforms, industry expert warns
An industry expert has warned that Nigeria’s proposed tax on cryptocurrency transactions could make the country’s digital asset market less competitive and encourage users to move their activities to offshore platforms.
Iwuno argued that any tax framework for virtual assets should be structured fairly to encourage participation and innovation rather than stifle the sector’s growth.
“If activities generate economic value, then they should also contribute economic value to the country,” he said.
However, he expressed concern over the proposed 1.5 per cent stamp duty on crypto-to-fiat conversions, arguing that the measure could place a heavier burden on virtual asset transactions than comparable activities in the traditional banking sector.
“There seems to be a different set of rules for the virtual asset space,” Iwuno said.
He warned that repeated transfers involving digital assets could attract multiple stamp duty charges, significantly increasing transaction costs for users.
According to him, the additional costs could make transactions in Nigeria more than 40 per cent more expensive than in competing jurisdictions, potentially pushing users towards offshore platforms.
“If it costs Nigerians significantly more than offshore platforms, they will simply move offshore,” he warned.
Iwuno cited India’s experience with similar cryptocurrency tax measures, saying the country recorded a significant decline in crypto market activity after imposing higher transaction taxes.
“India attempted the same thing and lost 81 per cent of its market,” he said.
He also argued that transaction-volume figures in Nigeria’s virtual asset market are sometimes misunderstood because the same funds can be transferred repeatedly, with each movement being counted as a separate transaction.
“The same money can move several times, but each movement is counted as transaction volume,” he explained.
Despite the concerns, Iwuno maintained that Nigeria remains one of the world’s major virtual asset markets, largely driven by strong retail adoption.
He urged policymakers to design tax policies that would preserve Nigeria’s competitive position in the global digital asset industry while supporting continued innovation and investment.
“Nigeria still holds huge potential because of the position we occupy globally,” he said.
Iwuno further called for taxes on virtual asset transactions to be paid in naira rather than digital tokens, noting that cryptocurrencies are not recognised as legal tender in Nigeria.
“The remittance of taxes should happen in naira,” he said.
