CBN Tightens Digital Asset Regulation, Sets ₦10bn–₦15bn Capital Threshold for Stablecoin Issuers
New framework imposes tougher licensing, reserve management, consumer protection and anti-money laundering obligations on virtual asset operators
ABUJA, November 8, 2026
The Central Bank of Nigeria (CBN) has introduced a stricter regulatory regime for stablecoin issuers and other virtual asset service providers, prescribing minimum capital requirements of ₦10 billion for naira-backed stablecoins and ₦15 billion for foreign currency-linked stablecoins.
The new requirements are contained in the Regulations for the Operations of Non-Security Virtual Assets in Nigeria, issued through a circular dated November 5, 2026, and signed by the Director of the Payments System Policy Department, Musa H. Jimoh.
Under the framework, operators classified as Class 1 issuers, responsible for issuing naira-referenced stablecoins, are required to maintain a minimum paid-up capital of ₦10 billion. Class 2 issuers, whose stablecoins are linked to foreign currencies, must meet a higher threshold of ₦15 billion.
Other providers of non-security virtual asset services are required to maintain at least ₦1 billion in paid-up capital, although the CBN may prescribe higher thresholds depending on the scale, nature and risk profile of their operations.
The framework establishes a risk-based regulatory structure for the licensing, supervision and monitoring of non-security virtual assets, including stablecoins, Deposit Money Tokens (DMTs) and services provided by Virtual Asset Service Providers (VASPs).
The apex bank acknowledged the growing importance of digital assets in facilitating payments, international remittances, settlements and digital commerce. However, it warned that their expanding adoption also presents potential risks to financial stability, monetary policy implementation, foreign exchange management, consumer protection and the integrity of the financial system.
Accordingly, the new regulations seek to balance financial innovation with stronger institutional oversight and safeguards to ensure that virtual asset activities operate within a well-defined regulatory environment.
Beyond the capital thresholds, the regulations introduce more stringent requirements covering corporate governance, liquidity management, reserve backing, cybersecurity, operational resilience, customer protection and regulatory reporting.
Stablecoin issuers are expected to maintain adequate reserve arrangements to support their issued tokens and guarantee redemption in accordance with prescribed regulatory conditions. These provisions are intended to minimise the risks of issuer insolvency, insufficient reserves and redemption failures.
The framework also reinforces compliance obligations relating to anti-money laundering, counter-terrorist financing and counter-proliferation financing.
In addressing peer-to-peer (P2P) transactions, the CBN requires service providers to establish mechanisms for identifying customers who engage in buying, selling or exchanging regulated tokens as a commercial activity.
The identification process will consider transaction volumes, frequency of transactions, the number of counterparties involved and whether exchange rates are publicly advertised.
Identified commercial P2P traders will be subject to enhanced due diligence, transaction limits and regulatory reporting obligations where applicable.
The Bank further clarified that identifying an individual as a commercial P2P trader does not automatically confer authorisation to operate a regulated virtual asset business. Such individuals must obtain the appropriate licence, discontinue the regulated activity or operate as authorised agents of licensed service providers, as required.
The regulations also extend compliance obligations to foreign virtual asset businesses offering, marketing or making their services available to customers in Nigeria.
According to the framework, operating from outside Nigeria does not automatically exempt foreign issuers and service providers from applicable Nigerian incorporation, licensing and capital requirements.
The CBN also provides for regulatory cooperation with the Securities and Exchange Commission (SEC) and other relevant authorities, particularly in areas where virtual asset activities intersect with securities, investment products and other regulated financial services.
Additional provisions address customer asset protection, transaction monitoring, identity verification and the disclosure of relevant information to regulatory authorities.
The new regulatory regime is expected to reshape the operating environment for businesses involved in stablecoin issuance, digital wallets, cryptocurrency-related payment services, asset custody and virtual asset exchanges.
Although the increased capital and compliance requirements could raise entry barriers, particularly for smaller fintech companies and emerging operators, the framework provides clearer regulatory expectations and establishes minimum standards for financial capacity, governance and consumer protection.
Industry operators may need to explore strategic partnerships, mergers, consolidation or adjustments to their existing business models to meet the new requirements.
For investors and financial institutions, the regulations offer a more structured basis for evaluating the financial strength, governance arrangements and operational reliability of virtual asset businesses.
The CBN maintained that the measures are designed to protect consumers against fraudulent practices, issuer failures, inadequate reserve backing and difficulties in redeeming stablecoins, while safeguarding monetary policy effectiveness and the stability of the Nigerian financial system.
The regulations took effect on November 5, 2026, and apply to relevant regulated activities conducted in or from Nigeria, including services offered by foreign operators to Nigerian customers.
The development signals a significant shift towards tighter supervision of Nigeria’s rapidly evolving digital asset market, with regulatory compliance, financial accountability and consumer protection taking centre stage.
Edited by Rosemary Aiyenale
Source: Vanguard Newspaper
