Deconstructing Nigeria’s Presidential Executive Order on Virtual Assets Coordination (2026): The NRS Co-Chairmanship Question

by Senator Ihenyen, Founding Editor

Introduction

President Bola Ahmed Tinubu signed the Presidential Executive Order on Virtual Assets Coordination, 2026, establishing a structured national framework to harmonize virtual asset oversight across Nigeria. Made by virtue of section 5 of the Constitution of the Federal Republic of Nigeria 1999 (as amended), the Order establishes two core administrative mechanisms:

1. The Virtual Asset Council (VAC): The apex policy-coordinating body chaired by the Central Bank of Nigeria (CBN), with the Nigeria Revenue Service (NRS) and the Securities and Exchange Commission (SEC) serving as Vice-Chairs. The council also includes the Nigerian Financial Intelligence Unit (NFIU) and the Office of the National Security Adviser (ONSA).
2. The Virtual Asset Office (VAO): The operational secretariat hosted at the CBN, equipped with an integrated Supervisory Technology (SupTech) platform to facilitate real-time inter-agency data sharing and application processing without displacing individual agency statutory mandates.

A standout feature of this architecture is elevating the Nigeria Revenue Service (NRS)—the national tax authority created to consolidate federal tax collection—to Vice-Chair of the primary virtual asset regulatory council.

This brief provides a policy evaluation of the NRS’s co-chairmanship, analyzes its justifications and pros & cons, compares it with global best practices, and considers whether alternative agencies—specifically the FCCPC (consumer protection) and NITDA (technology standards)—should have been integrated.

Analyzing NRS Co-Chairmanship: The “Why”, Pros, and Cons

Generally, the division of labor is noticeable in the structural framework of the Activity-based oversight is assigned based on primary roles: SEC oversees virtual assets that qualify as securities; CBN handles payment, settlement, custody, and banking gateways for non-security digital assets; NFIU oversees financial intelligence relating for digital asset transactions and its interactions with fiat; and the ONSA ensures national security. 

However, elevating a national tax authority to executive co-chairmanship alongside a capital markets regulator (SEC) and under a central bank (CBN) is a distinct institutional decision that is worth reviewing closely.

1. The “Why”: Justifications for NRS Inclusion

• Capitalizing on High Domestic Adoption: Nigeria ranks among the world’s leading peer-to-peer (P2P) and retail crypto adoption markets. Significant transactional volume moves outside traditional financial accounting, leading to potential lost national revenue from capital gains and companies income.
• Fiscal Consolidation Agenda: Following Nigeria’s tax administration reforms (e.g., the transition from FIRS to NRS under the Nigeria Tax Act), the Nigerian state aims to broaden its non-oil revenue tax base.
• Shared SupTech Visibility: Hosting the Virtual Asset Office (VAO) at the CBN with an integrated SupTech platform gives NRS real-time visibility into VASP order books, settlement flows, and corporate revenues, eliminating reliance on delayed manual tax filings.
• Deterring Illicit Capital Flight: Digital assets can be leveraged for foreign exchange arbitrage and informal capital transfer. Co-chairmanship allows NRS to cross-reference tax identification numbers (TINs) against VASP customer records to deter tax evasion.

2. The Pros: Benefits to the Regulatory Ecosystem

• Immediate Formalization & Legitimacy: Subjecting an asset class to explicit, structured taxation recognizes it as a legitimate component of the formal economy, moving past past informal prohibitions.
• Policy Coherence Across Fiscal & Monetary Lines: Historically, fiscal policy (tax collection) and monetary policy (financial stability) operated in silos. Placing NRS as Vice-Chair ensures that tax directives align with central bank monetary goals and SEC investor protection standards.
• Reduction of Regulatory Arbitrage: VASPs cannot comply with SEC/CBN licensing rules while ignoring fiscal reporting obligations. Co-location within the VAC forces a unified compliance process.

3. The Cons & Potential Risks

• Risk of Premature Revenue Extraction: Elevating the tax authority to Vice-Chair risks prioritizing short-term revenue generation over market growth, technical incubation, and financial inclusion.
• Chilling Effect on Innovation: Overly aggressive tax collection or complex reporting requirements early in a market’s development can drive retail users and startups back to informal, decentralized, or offshore channels.
• Role Mismatch in Market Development: Tax authorities naturally prioritize revenue enforcement, whereas emerging digital asset ecosystems often require flexible sandbox environments and regulatory guidance before strict enforcement is introduced.

Global Comparative Analysis: NRS vs. International Best Practices

Placing a revenue authority as an executive Vice-Chair on a primary digital asset regulatory council contrasts with frameworks in several mature jurisdictions:

Jurisdiction	Lead Regulatory Bodies	Revenue Authority Role	Governance Positioning
Nigeria (VAC 2026)	CBN (Chair), SEC (Vice-Chair), NRS (Vice-Chair).	Co-Chair / Executive Vice-Chair of primary virtual asset policy body.	Embedded Policy Leader: Direct influence over VASP licensing, SupTech data access, and general industry governance.
United States	SEC, CFTC, Treasury (FinCEN), Federal Reserve.	IRS (Internal Revenue Service): Enforcer & Tax Collector.	Observing/Participating Enforcement Agency: The IRS enforces tax laws (e.g., Form 1099-DA) and participates in multi-agency task forces (such as J5), but does not co-chair SEC or CFTC policy boards.
United Kingdom	Financial Conduct Authority (FCA), Bank of England.	HMRC (His Majesty’s Revenue and Customs): Tax Policy Specialist.	Inter-agency Taskforce Member: Part of the UK Cryptoassets Taskforce alongside FCA and Bank of England, but FCA remains the sole gateway licensing regulator.
South Africa	Financial Sector Conduct Authority (FSCA), Reserve Bank (SARB).	SARS (South African Revenue Service): Advisory/Tax Enforcement.	Working Group Participant: Operates within the Inter-Ministerial Fintech Working Group (IFWG); FSCA handles market licensing while SARS handles tax guidance.
European Union	ESMA, EBA, National Competent Authorities (NCAs).	Member State Tax Agencies (operating under DAC8 / CARF guidelines).	Information Recipient: Tax authorities receive standardized automatic exchange of information (CARF/DAC8) from licensed CASPs, but do not directly manage supervisory licensing bodies.

 

Comparative Insight: Nigeria’s structural model gives its tax authority a direct executive vote in the primary virtual asset regulatory body. While this ensures immediate tax reporting compliance, it represents an aggressive revenue-focused governance structure compared to global peers who separate financial licensing from tax collection.

Critical Institutional Gaps: Evaluating FCCPC and NITDA

While the VAC integrates monetary, capital market, fiscal, intelligence, and national security interests, two notable institutional domains are absent from the council’s core structure: Consumer Protection and Technology/Data Governance.      

1. The Case for the FCCPC (Federal Competition & Consumer Protection Commission)

• Current Regulatory Gap: Central banks and securities regulators typically focus on macro-prudential stability, platform solvency, and market manipulation. They are often less structured for individual retail trade disputes, unfair exchange terms, account lockouts, or predatory yield promotions.
• Why FCCPC Belongs in the Framework: Including the FCCPC (or creating a dedicated consumer complaints desk within the Virtual Asset Office) would provide retail users with an accessible avenue for dispute resolution without forcing individual claims through capital market arbitration or court litigation.

2. The Case for NITDA (National Information Technology Development Agency) & NDPC (Data Protection Commission)

• Current Regulatory Gap: Virtual asset service providers depend on underlying tech infrastructure, including smart contracts, API integrations, distributed ledger nodes, cybersecurity protocols, and user data management.
• Why NITDA/NDPC Belong in the Framework:

• Data Privacy in SupTech: The Executive Order introduces an integrated SupTech platform for real-time inter-agency data sharing. Sharing financial data across multiple agencies introduces data privacy risks covered under the Nigeria Data Protection Act (NDPA). NDPC oversight is crucial to ensure user data remains secure.
• Technical Audits: NITDA provides specialized oversight for auditing smart contracts, assessing cybersecurity resilience, and setting open-source software standards that financial regulators may not be equipped to evaluate natively.

Policy Verdict: Addition or Replacement?

NRS should remain on the Council due to the need for clear tax policy. However, placing it as a Vice-Chair shifts the Council’s orientation heavily toward fiscal extraction.

To build a balanced ecosystem, FCCPC and NITDA/NDPC should be integrated as non-executive statutory members of the VAC or formally attached to the operational Virtual Asset Office (VAO).

Actionable Recommendations for African Policy Leaders

1. Balance Revenue Extraction with Market Incubation

Central banks and revenue authorities across Africa should ensure that tax collection frameworks do not outpace industry development. Tax policies for virtual assets should feature clear, tiered capital gains and corporate tax structures that protect early-stage fintech innovation.

2. Establish Data Privacy Safeguards for Shared SupTech

When establishing centralized supervisory technology platforms (like Nigeria’s VAO), clear data minimization and access protocols must be legally codified. Shared database access across tax, intelligence, and central bank systems must comply with national data protection laws to maintain public trust.

3. Formalize a Consumer Dispute Resolution Pillar

Regulators should incorporate consumer protection agencies into their virtual asset frameworks. Establishing dedicated complaint resolution mechanisms reassures retail users and helps suppress fraudulent investment schemes before they scale.

4. Provide Sector-Specific Tax Guidance Ahead of Enforcement

Revenue authorities (such as the NRS) should issue clear, explicit tax guidance—defining cost basis calculations, staking reward treatments, and exchange reporting formats—prior to initiating compliance audits or enforcement actions.

Conclusion

Nigeria’s Presidential Executive Order on Virtual Assets Coordination 2026 represents a significant structural pivot from fragmented, siloed agency oversight to an integrated supervisory model. By embedding the Nigeria Revenue Service (NRS) alongside the Securities and Exchange Commission (SEC) as Vice-Chairs under Central Bank of Nigeria (CBN) leadership, the framework signals an explicit intent to formalize the country’s high-volume digital asset economy and harness shared supervisory technology (SupTech) for tax compliance.

However, placing a national revenue authority in an executive co-chairmanship position creates a fiscal-heavy governance structure that departs from international benchmarks, where tax agencies typically function as information recipients rather than primary gatekeepers. 

To prevent premature revenue extraction from dampening market innovation, Nigerian policy leaders must balance tax enforcement with market incubation. Crucially, expanding the Virtual Asset Office framework to include statutory representation for consumer protection (FCCPC) and data governance (NITDA/NDPC) will ensure that retail safeguards, smart contract integrity, and user data privacy are advanced alongside fiscal and national security priorities.

 

Disclaimer: Published in the section, “From the Editor”, the piece above is a direct note by the Founding Editor sharing personal views with CAB readers, therefore they are strictly Senator Ihenyen’s perspectives, not CAB’s institutional position.