The new tax reform has finally taken effect, with cryptocurrency transactions now subject to tax under the Nigeria Tax Administration Act (NTAA).
The NTAA, which came into force from January 1, 2026, introduced significant compliance demands on Virtual Assets Service Providers (VASPs).
VASPs are also mandated to register with the tax authority, to retain detailed KYC data for seven years, and to report large or suspicious transactions to both the tax authorities and the Nigerian Financial Intelligence Unit (NFIU).
Non-compliance attracts a N10 million penalty in the first month and N1 million for each subsequent month, alongside potential licence suspension or revocation by the Securities and Exchange Commission (SEC).
This is an unfamiliar development in the crypto space, leaving service provider and traders vulnerable to penalties.
In this interview with Naijaonpoint, Tradepal AI co-founders, Femi Adegolu and Adebiyi Ayoyinka discuss compliance gaps, Ghana parliament’s legalisation of crypto, and how businesses can avoid penalties.
Naijaonpoint: From your perspective, what are the most significant compliance gaps that you think this tax reform is trying to cover for businesses and individuals?
Femi Adegolu: The most significant compliance gaps that this new tax law exposes are the lack of transparency and, of course, transaction monitoring. Last year alone, hundreds of billions of dollars passed through Nigeria, through P2P, those who buy and sell Bitcoin, forex, dollars, pounds, euros. And the government sees all these big numbers, but these are just volumes.
To be very honest, the profit that has been generated is not in line with what the government thinks. Even fintechs, I have fintechs that have processed over $4 million in volume, but what are their net profits? Once you deduct operating expenses, you find out that these guys are sometimes overtaxed by the government. So these loopholes are what this new tax regime will expose.
Because every company right now does not understand the importance of having narrations. Like, sometimes when I want to send money, I don’t add narrations. But believe me, from now on, I’m starting to do that.
And so what this thing exposes is transparency. Because the government sees so much volume passing through our industry, the crypto industry in particular, and they actually also do not know the nitty-gritty of what a lot of these operators are facing, especially OTC traders. And for a long time, a lot of fintechs, service providers who actually offer crypto services, have been looking for ways to get licenses from SEC.
But how many of them can afford to pay one billion naira? So I think this is step one, because now these guys are going to be filing taxes and also letting the government know, ‘this is the inflow, this is the outflow, this is the revenue, this is the turnover we’re making, this is the profit that we have made, and this is how much of taxable income that we can remit to the government’. Those are the things that I know significantly will impact from this new tax regime.
Naijaonpoint: What is the missing link between the usual crypto trading and this new tax regime that startups should be addressing with their solutions?
Adebiyi Ayoyinka: I would love to say this is a very unique period in the crypto industry.
So it’s a very special time that we have to fully prepare for, and over the years, from my involvement so far in doing OTC trades and even the normal crypto trade, a lot of people tend to participate blindly in one or two aspects of the industry.
Most of us do things in a very disorganised manner, whereby we don’t keep proper records of things that happen during daily transactions or business. This has created a mindset for every single OTC trader, who tends to want to continue following this same pattern over and over again.
Most of us do things in a very disorganised manner, whereby we don’t keep proper records of things that happen during daily transactions or business. This has created a mindset for every single OTC trader, who tends to want to continue following this same pattern over and over again.
As much as I don’t like that the tax thing is here, I actually like the fact that it is happening right now to give a future to everyone that engage in trading digital assets, unlike the way we always have it before, so now things are better, if we start doing things the right way.
Just imagine when an OTC trader or merchant goes buying and selling and pays out a huge sum of money, and at the end of the day, you don’t tend to know even the amount you’ve made on that particular transaction. You don’t know the amount you’ve made in a week, in a month, or in a year.
So these gaps and this suddenness are really affecting a whole lot, and when it comes to taxing now, the government are ready and prepared to start taxing people, so now is the time when traders or merchants see where they’ve been doing things wrongly because they are all thinking how do I survive this?
And that is where our platform comes in. Tradepal AI ensures that transactions are properly documented. It has an audit tray where you can go back there within the week or month to review those transactions, then print out the record whenever you’re going to a tax man.
We have the software with features in place whereby you can grant your login details to an auditor to access your dashboard and audit your account remotely, while you monitor it from your own device.
Naijaonpoint: Right now, most Nigerians view this digital assets taxation as very unclear and unenforceable. Do you share the same view?
Femi Adegolu: So in a nutshell, the government has been looking for a way to tax the crypto industry. It’s an early-stage industry, at least less than two decades.
So, 2025, I would say was the year of Institutional adoption of cryptocurrency across the globe, from the US presidency to other countries, even creating their own coins like the Central African Republic. Many other countries are also building reserves for their crypto assets. El Salvador is already doing it.
Many countries across the Middle East and Southeast Asia are already storing Bitcoin, and so for Nigeria, which is the largest crypto market in Africa, where hundreds of billions of dollars are being processed every year, we believe that we are the best market to be able to have this experiment of taxing virtual assets.
Service providers have been looking for a way to stay compliant the past couple of years, and of course this gives most especially the OTC traders, BDCs, forex traders that ability to sit down on the same table with the government, because now they pay taxes like other businesses, they pay tax like other corporate entities, and this also brings in more regulatory clarity, because for Tradepal AI we have also built a KYC system that will enable the government also know who the money is coming from, where the money is going to, how the money is being spent, and what is also taxable.
You can have an inflow of N1.5 billion from just one transaction, but that is just inflow, that is not turnover, that is not income, and that is not profits. so it is our innovative tool that we are going to use to make this clarity much more transparent to the government, saying that this 1.5 billion that was sent to this man’s account is not turn over, it is just an inflow and this is what profit this person made from this, and this is the proof, this is the evidence that it is the profit that this man made from this particular transaction.
So that the government has much trust in our system and industry, also, the government believes that we are more like partners. Because a lot of times, one of the things that has made the crypto space at loggerheads with the government is because it looks like the crypto industry is not supportive of what laws or regulations the governments are passing, because it is not favourable, but when we have this new tax law and these assets have been taxed, we’ll have that clarity.
The government will have clarity on how much is being processed in a single year. We have data, and we can offer support in terms of research, so those who want to write editorials about the crypto space can come to us, and we’ll be able to provide all that data and value for them.
Naijaonpoint: Recently, Ghana’s parliament legalised cryptocurrency. What do you think this mean especially when we have a huge population of Nigerians in Ghana who trade crypto?
Femi Adegolu: Literally, I know a lot of Nigerians who trade crypto in Ghana who are happy with that new law. In Nigeria, for example, crypto is not illegal, but the only issue is that the CBN and SEC are not in alignment in terms of how these laws are being executed or implemented.
And I will say for the news from Ghana, I’m very excited for it because it shows that Ghana is thinking ahead, they’re thinking of the future, positioning themselves, because if you look at the biggest conferences, it’s all going to Ghana or Kenya and that is because there is a lot of regulatory disparities in Nigeria and no investor wants to invest in the country that has no stable regulation or law that can protect them. It’s called investor protection.
But with our taxation law, it is going to be in sync with what the government has done already in the past with the former laws, with the former policy of blockchain documents that have been enacted during the time of President Buhari. We are going to see much more involvement with this new dispensation and that will also enable the sub-Saharan trade in West Africa attract much more investments, it will attract much more startup funding.
It’s also going to enable more startups open up to the West Africans sub-Saharan region, and with Nigeria well-positioned to be close brothers to Ghana, we will see lot more legislative laws passed in the National Assembly.
We’re going to see much better regulations passed by our government because Ghana is our closest brother here in Africa. And I’m sure that will enable more inflows. So congratulations to Ghana, we are happy for them, we know that Nigeria is also leading in that front to enable crypto become a much more everyday thing that we use for our daily trade.
Naijaonpoint: How prepared do you think the Nigerian SMEs, fintechs and startups are for automated tax computation and reporting?
Femi Adegolu: To be very honest, I’ll say the informal sector and SMEs are not so prepared and that’s why we’re here to help them, some months ago, we have actually foreseen that this is going to happen when Ambassador Adebiyi told me about this idea that we need to build something that will help businesses, fintechs, and service providers become very compliant and also avoid tax penalties by the government.
Already, there’s a lot of news flying around about how crypto taxes should work; the SMEs are also very scared. I can tell you there’s a lot of fear in Nigeria, but people should not be scared. I’m very sure with what we’ve built already, it’s just like a plug-and-play. People could come, log in their trades, have access to accurate data, record keeping, transaction monitoring, and transparency, because now Tradepal AI will be that tool that will help channel narrative.
It is not a taxman that will actually come to tell you how much is coming into your bank account, It is you that will actually say this is money that has come into my bank account as my own money, this is the other one coming as a loan.
So it is in your own capacity to tell the government that this is how much you are making, and this is how much you are actually paying back as loan. So if SMEs use the right platform, they’ll be more prepared,