The Central Bank of Nigeria has set a minimum paid-up capital requirement of N15bn for companies seeking to issue foreign currency-backed stablecoins, including digital tokens linked to the United States dollar.
The new requirement forms part of a broader regulatory framework introduced by the apex bank to strengthen oversight of virtual assets and digital payment services operating in Nigeria.
The provision is contained in the Regulations for the Operations of Non-Security Virtual Assets in Nigeria, released by the CBN on Friday, following a circular dated November 5, 2026, and signed by the Director of the Payments System Policy Department, Musa Jimoh.
Under Section 15.2 of the regulations, the apex bank stipulated that companies licensed under Class 2, which covers foreign currency-referenced stablecoin issuers, must maintain the prescribed capital throughout their operations.
The regulation stated, “A Class 2 Licensed Issuer shall maintain minimum paid-up capital of fifteen billion Naira (N15,000,000,000), or such higher amount as the Bank may prescribe, on entry and at all times thereafter.”
The requirement applies to issuers of stablecoins designed to maintain a relatively constant value against foreign currencies, particularly the US dollar, by linking their value to the corresponding currency.
However, the CBN established different capital thresholds for other categories of virtual asset operators, depending on the nature of their services and the currencies backing their digital tokens.
Under the framework, issuers of naira-denominated stablecoins, classified as Class 1 operators, are required to maintain a minimum paid-up capital of N10bn.
The regulation provides, “A Class 1 Licensed Issuer shall maintain paid-up capital of ten billion Naira (N10,000,000,000), or such higher amount as the Bank may prescribe, on entry and at all times thereafter.”
Other non-security virtual asset service providers are required to maintain a minimum paid-up capital of N1bn.
The CBN further clarified that this capital requirement must be maintained independently of funds committed to licences obtained from the Securities and Exchange Commission or other regulatory agencies.
The differentiated capital requirements reflect the regulator’s approach to addressing the varying financial, operational and systemic risks associated with stablecoin issuance and other virtual asset activities.
The new rules also give the apex bank the authority to impose higher capital requirements on individual operators where necessary, taking into consideration factors such as transaction volumes, market relevance, redemption obligations, technological vulnerabilities and potential exposure to the wider financial system.
Beyond the minimum capital thresholds, the regulations stipulate that funds designated as regulatory capital must not be combined with other financial obligations imposed on licensed issuers.
The document stated, “Capital shall be separate from and additional to issuer reserves, the CBN reserve deposit, customer funds and assets and operational liquidity.”
This provision means that stablecoin operators cannot rely on the same pool of funds to meet their minimum capital requirements, maintain reserves backing tokens in circulation, satisfy reserve deposit obligations or provide liquidity for their daily operations.
The apex bank also specified the forms in which eligible regulatory capital must be maintained, requiring the funds to be held as cash in designated accounts with the CBN or in approved Federal Government securities under the regulator’s control.
The regulations further introduce reporting and corrective measures for operators whose capital positions fall below the prescribed minimum.
Affected companies are required to notify the CBN immediately and submit a capital restoration plan within 10 business days.
While the affected operator works towards restoring compliance, the regulator may impose restrictions on additional token issuance and the onboarding of new customers.
In addition to the capital requirements, the CBN introduced stringent provisions governing the assets backing stablecoins, requiring licensed issuers to maintain reserve assets equivalent to at least 100 per cent of their outstanding token obligations, alongside an additional two per cent buffer to absorb potential losses.
The reserve requirement is intended to ensure that stablecoin issuers have sufficient eligible assets to meet redemption requests and maintain confidence in the value of their digital tokens.
Emphasising the importance of adequate backing before new tokens are created, the regulations stated, “No Licensed Issuer shall issue new stablecoin tokens (mint) unless, at the time of minting, equivalent Eligible Reserve Assets have been received and held in the Reserve Pool.”
The framework also provides for the protection of stablecoin holders by requiring issuers to redeem tokens at their face value.
Under the rules, standard redemption requests must generally be honoured no later than the next business day after a valid request is submitted, without imposing charges on holders for ordinary redemption transactions.
The CBN also prohibited certain categories of stablecoins considered to pose heightened risks to users and the financial system.
These include algorithmic stablecoins that depend primarily on adjustments to token supply rather than adequate reserve assets to maintain their value.
Digital tokens linked to fiat currencies but backed mainly by other cryptocurrencies are also prohibited under the new framework.
The regulator further introduced additional supervisory obligations for stablecoins that attain significant market penetration or widespread usage in Nigeria.
Under the provisions, a stablecoin will be classified as systemically important if its circulating value exceeds N500bn for 30 consecutive days or if it is adopted by more than five million users in the country.
Operators of such instruments will consequently face enhanced regulatory scrutiny because of their potential impact on financial stability, payment systems and the broader economy.
Beyond stablecoin issuers, the regulations extend to several other segments of the virtual asset industry, including cryptocurrency exchanges, digital wallet providers, payment gateways, remittance operators, custody service providers and platforms facilitating peer-to-peer transactions.
The framework establishes compliance obligations covering anti-money laundering and counter-terrorism financing measures, customer identification, transaction monitoring, cybersecurity standards, consumer protection and periodic regulatory reporting.
It also makes clear that the requirements apply to both Nigerian and foreign companies providing regulated virtual asset services to customers in the country, irrespective of whether such operators maintain physical offices within Nigeria.
However, the CBN clarified the division of regulatory responsibilities between itself and the Securities and Exchange Commission, noting that virtual assets classified as securities would remain under the SEC’s jurisdiction.
The two regulators are expected to coordinate their supervisory activities in areas where their respective mandates overlap.
Explaining the rationale behind the new framework in its accompanying circular, the apex bank said the regulations were intended to “promote responsible innovation, strengthen the integrity of the Nigerian financial system and provide an appropriate regulatory framework for emerging digital payment instruments.”
The regulations, which took effect on November 5, 2026, establish a more comprehensive licensing, capital adequacy and supervisory regime for companies operating in Nigeria’s expanding virtual asset and digital payment market.
The introduction of the new requirements marks a significant regulatory development for stablecoin issuers and other virtual asset service providers, as the CBN seeks to balance innovation in digital financial services with stronger consumer protection, financial stability and accountability.
