SIBAN Warns Heavy Crypto Taxes, Fees Could Drive Investors Out of Nigeria
The Stakeholders in Blockchain Technology Association of Nigeria (SIBAN) has backed the Federal Government’s move to bring virtual and digital assets into Nigeria’s formal economy, but warned that excessive taxes, registration fees and capital requirements could slow the industry’s growth.
The association said clearer regulations from the Securities and Exchange Commission (SEC) represent a major step forward for Nigeria’s blockchain and cryptocurrency industry.
However, it raised concerns about the financial demands placed on businesses seeking to operate legally under the proposed regulatory framework.
SIBAN Welcomes SEC’s Push for Clearer Crypto Rules
SIBAN President, Mela Claude Ake, said the shift from uncertainty towards formal regulation could send a positive message to both local and international investors.
According to him, establishing clear rules would help remove the regulatory grey area surrounding virtual assets and give legitimate businesses a clearer path to operate within Nigeria.
The association believes formal recognition of the sector could also strengthen investor confidence and encourage more blockchain businesses to build their operations within the country.
But while SIBAN supports regulation, it said the cost of complying with the proposed rules could become a major obstacle for smaller companies and startups.
Billions in Capital Requirements Raise Concerns
SIBAN expressed particular concern over the proposed minimum capital requirements, which it said could run into billions of naira, as well as registration fees running into hundreds of millions of naira.
The association argued that most innovators entering Nigeria’s blockchain industry are not backed by large amounts of capital.
It warned that forcing young businesses to meet extremely high financial requirements could prevent promising startups from entering the regulated market in the first place.
SIBAN also raised concerns about additional taxes on virtual asset transactions.
The association pointed to the Nigeria Revenue Service’s virtual assets taxation guidelines, which include a 1.5 per cent stamp duty on crypto transactions.
According to SIBAN, combining transaction-level taxes with high registration costs and capital requirements could put too much pressure on an industry that is still developing.
SIBAN Wants Government to Support Local Startups
Rather than focusing heavily on revenue generation at this early stage, SIBAN urged the government to create policies that help Nigerian blockchain companies grow, attract investment and compete internationally.
The association said supporting local technology talent and emerging businesses would give the industry a better chance of becoming a strong contributor to the Nigerian economy.
It also warned that excessive regulatory costs could encourage Nigerian founders and investors to move their businesses and capital to countries with more accommodating policies.
Such a move, it said, could worsen brain drain and make Nigeria lose businesses and skilled professionals that could otherwise contribute to the country’s technology ecosystem.
Heavy Fees Could Push Crypto Businesses Offshore
SIBAN maintained that Nigeria needs regulation that protects investors and gives the government proper oversight without making it unnecessarily difficult for legitimate businesses to operate.
The association called for an approach that builds confidence in the virtual asset industry while keeping the door open for early-stage companies and new innovators.
Its position is that Nigeria can benefit more from helping the sector mature before placing excessive financial burdens on businesses.
As the government continues to develop its regulatory framework for virtual assets, the debate is now shifting beyond whether cryptocurrencies should be regulated to how Nigeria can regulate the sector without driving innovation and investment elsewhere.
For local blockchain entrepreneurs, investors and technology professionals, the balance between regulation, taxation and room for growth could determine whether Nigeria becomes a major hub for the emerging digital-asset economy or loses some of its opportunities to competing markets.
