Mining Crypto in Nigeria: Legal Rules and Restrictions in 2025

Can you legally mine cryptocurrency in Nigeria? The answer isn’t simple. It’s not banned - but it’s not exactly legal either. As of 2025, mining crypto in Nigeria exists in a tight space between permission and prohibition. If you’re running rigs in your garage or setting up a small farm in Lagos, you’re not breaking the law by turning on your machines. But if you try to deposit earnings into a Nigerian bank account, cash out through a local exchange, or even pay your electricity bill with crypto, you’re walking into a minefield of rules, fines, and hidden traps.

What’s Actually Allowed?

The Nigerian government doesn’t have a law that says, “Mining Bitcoin is illegal.” That’s important. But it also doesn’t say, “You’re free to mine.” Instead, it’s built a system where you can operate - if you jump through enough hoops. The key change came in 2025 with the Investments and Securities Act (ISA 2025). This law reclassified all virtual assets, including mined coins, as securities. That means if your mining operation connects to an exchange, offers mining-as-a-service, or sells tokens to Nigerian users, you’re now a Virtual Asset Service Provider (VASP). And VASPs must be licensed by the Securities and Exchange Commission (SEC).

So if you’re just solo mining and holding your Bitcoin or Ethereum in a wallet, no one’s coming to shut you down. But if you start selling that crypto to others, or even just converting it to naira through a P2P platform, you’re now in the SEC’s scope. And the SEC doesn’t play around. They’ve already licensed Quidax and Busha. Dozens more are waiting. If you’re not registered, you’re operating illegally - even if you didn’t mean to break the rules.

Banking Restrictions Still Hold

You might have heard the Central Bank of Nigeria (CBN) lifted its 2021 ban on banks servicing crypto firms. That’s true - but only for licensed ones. The CBN still refuses to let unlicensed businesses open bank accounts. And here’s the catch: the SEC only licenses companies that meet strict requirements. You need a Nigerian corporate registration, a physical office, paid-up capital of at least ₦50 million ($33,465), a fidelity bond, and full AML/KYC compliance. Most individual miners can’t meet that. So even though the ban is technically lifted, the door is still locked for anyone without a license.

This forces miners to use peer-to-peer (P2P) platforms like Paxful, Binance P2P, or local apps to sell their crypto. It works - Nigeria moved $92.1 billion in crypto between July 2024 and June 2025, making it the second-largest crypto market in Africa. But P2P comes with risks: scams, chargebacks, and no buyer protection. You’re on your own. And if you get caught laundering money through these platforms, the Economic and Financial Crimes Commission (EFCC) can track your phone number, IP address, and transaction history. They’ve been granted access to telecom records under ISA 2025. You won’t get a warning. You’ll get an investigation.

Taxes Are Now a Real Threat

In June 2025, Nigeria passed the Nigeria Tax Administration Act (NTAA 2025). It doesn’t just say you owe taxes on mining profits - it says you’ll pay heavily if you don’t report. Starting in 2026, any unlicensed VASP that fails to file tax returns or pay owed taxes will face a ₦10 million ($6,693) fine in the first month. That’s not a small penalty. Then, every month after that, you pay an extra ₦1 million ($669) - until you comply. There’s no grace period. No first-time warning. Just fines that stack up fast.

And it’s not just about income. If you sell mined crypto and make a profit, that’s a capital gain. If you use Bitcoin to buy a laptop, that’s a taxable event. The tax authority doesn’t care if you didn’t convert to naira. The value at the time of the transaction is what matters. Most miners don’t track this. They assume, “I didn’t cash out, so I’m fine.” That’s a dangerous assumption. The NTAA 2025 gives the Federal Inland Revenue Service (FIRS) direct access to blockchain data and exchange records. They’re not guessing - they’re auditing.

Infrastructure Is a Silent Killer

Even if you clear every legal hurdle, you still have to deal with Nigeria’s power grid. Electricity is unreliable. Many areas get only 4-6 hours of power a day. The rest? Generators. And diesel isn’t cheap. A single ASIC miner like the Antminer S19 Pro uses 3,250 watts. Running it 24/7 on a generator in Lagos could cost you over ₦40,000 ($267) a month in fuel alone. That’s more than the average monthly salary in many parts of the country.

Some miners have tried solar solutions. But high-quality solar setups with battery storage cost upwards of ₦1.5 million ($1,000). Most don’t have that kind of upfront cash. And even if they do, the system needs constant maintenance. Dust, heat, and humidity eat through equipment fast. In the end, many miners find it cheaper - and safer - to move their rigs to countries like Canada or Kazakhstan, where electricity is cheap, stable, and legal.

Who’s Getting Licensed - And Who Isn’t

By late 2024, only two Nigerian crypto exchanges - Quidax and Busha - received provisional licenses from the SEC. That’s it. Not because they’re the only ones trying, but because the bar is high. You need a legal team, auditors, compliance officers, and a physical office with CCTV and security. Most small-time miners don’t have any of that. And the SEC isn’t rushing approvals. They’re vetting every applicant. Background checks. Financial audits. Source-of-funds verification. It’s a marathon, not a sprint.

Meanwhile, thousands of unlicensed miners keep running rigs. They call themselves “HODLers,” not businesses. They don’t advertise. They don’t accept customers. They just mine and hold. That’s the grey zone. The SEC doesn’t go after individuals who aren’t offering services. But if your wallet suddenly starts sending large sums to an unlicensed exchange? That’s a red flag. And once flagged, your identity can be traced - even if you used a VPN or fake ID.

What Happens If You Get Caught?

There’s no public record of anyone being jailed for mining crypto in Nigeria. But there are plenty of cases where people lost everything. In 2024, the EFCC seized over ₦2.3 billion ($1.5 million) in crypto assets linked to unlicensed trading platforms. One man in Abuja lost his entire mining farm - 27 ASICs worth ₦8 million - after a customer reported him for “fraudulent transactions.” He hadn’t stolen anything. He just didn’t have a license. The EFCC seized the equipment, froze his bank accounts (even though he didn’t use them), and fined him ₦5 million. He still owes that.

And it’s not just about equipment. If you’re using borrowed money to buy miners - say, from a friend or a loan app - and you can’t pay back because the price dropped? That’s fraud. The law now treats unlicensed crypto trading as financial misconduct. You can be blacklisted from future loans, barred from government contracts, and even denied travel visas.

What’s the Real Way Forward?

If you want to mine crypto legally in Nigeria, here’s the only path:

1. Register your business with the Corporate Affairs Commission (CAC) as a company - not a personal venture.
2. Apply for a VASP license from the SEC. Prepare for a 6-12 month wait.
3. Set up a local office with staff, security, and compliance systems.
4. Use licensed exchanges only - Quidax, Busha, or others on the SEC’s approved list.
5. Track every transaction. Keep receipts. Record wallet addresses. Report gains.
6. Pay taxes. Even if you think you won’t get caught - you will.

That’s it. No shortcuts. No hacks. No “just this once.” The government isn’t trying to kill crypto. It’s trying to control it. And if you want to play, you have to play by their rules.

Is It Worth It?

Some say yes. Nigeria’s crypto market is huge. The talent is growing. The blockchain policy is pushing innovation. And with global crypto prices rising in 2025, mining could still be profitable - if you can handle the costs.

Others say no. The risks outweigh the rewards. The electricity is too expensive. The rules change too fast. The penalties are too steep. And if you’re not a corporation with legal backing, you’re just a target.

The truth? Mining crypto in Nigeria isn’t dead. But it’s no longer a wild west. It’s a courtroom with a power outage. You can do it - but only if you’re ready to treat it like a real business. Not a side hustle. Not a gamble. A regulated, taxed, audited, licensed enterprise. Anything less? You’re not mining crypto. You’re just waiting to be found.