Nigeria's central bank is setting a ₦15 billion capital floor for foreign-currency stablecoin issuers, alongside a ban on algorithmic stablecoins and a requirement to operate through locally incorporated, licensed entities. The rules put both the issuer's own money and the assets backing customers' tokens under closer supervision.
Naira-backed stablecoin issuers face a lower ₦10 billion minimum. Both categories must maintain the required paid-up capital when entering the market and throughout their operations, with the Central Bank of Nigeria able to demand more where the risks justify it.
The foreign-currency threshold is roughly $11 million. The legal amount is fixed in naira, so the dollar conversion changes with the exchange rate. More importantly for issuers, this capital cannot also serve as the reserves backing their tokens.
An overseas license won't be enough
The CBN's regulations divide issuers into two groups: Class 1 for naira-referenced stablecoins and Class 2 for tokens linked to a foreign currency.
A foreign-currency token can be offered, distributed, exchanged, held in custody or redeemed for people in Nigeria only through a Nigerian-incorporated entity holding the relevant issuer license. An overseas approval or an arrangement with a Nigerian intermediary cannot replace that license or the separate approval required for the token itself.
The bank makes the position explicit:
There is no offshore issuer exemption from incorporation, licensing or capital.
Applicants must also show that Nigerian management can respond to the regulator. The requirements include a resident chief compliance officer, local access to records, and authority to follow lawful directions without first seeking permission from an offshore parent.
Approval to issue a foreign-currency stablecoin does not automatically authorize its use to settle or price a domestic obligation denominated in naira. That requires express permission under the applicable foreign-exchange or other law.
The ban reaches beyond algorithmic tokens
Algorithmic stablecoins are prohibited where they seek to hold their value mainly through adjustments to supply or demand instead of full backing by eligible reserve assets. The restriction covers issuance, offering, distribution and trading in Nigeria.
The prohibited list also includes fiat-referenced tokens backed wholly or mainly by other virtual assets, and tokens marketed as stablecoins without giving holders an enforceable right to redeem at par. Tokens issued by sanctioned persons, or on their behalf, are covered too.
That gives the framework a test beyond a token's name or marketing: what backs it, and what can its holder legally claim?
Capital and customer backing stay separate
Issuers must satisfy capital-deposit requirements using cash in the designated CBN account or permitted Nigerian government securities held through an approved custodian and subject to the bank's lien. Virtual assets, guarantees and anticipated transfers don't qualify.
The regulations draw a firm boundary around that money:
Capital shall be separate from and additional to issuer reserves, the CBN reserve deposit, customer funds and assets and operational liquidity.
The same funds cannot be counted twice across those requirements. Issuers also cannot withdraw or otherwise encumber capital held at the CBN, or subject to its lien, without prior written approval.
For customers, reserve reporting becomes a recurring obligation. Licensed issuers must publish monthly reserve attestations within 15 business days after each calendar month ends. The reports must disclose tokens in circulation, reserve composition and whether backing requirements have been met.
A license doesn't turn a stablecoin into an insured bank deposit. The framework expressly bars issuers from presenting Class 1 or Class 2 tokens as bank deposits or as covered by Nigeria Deposit Insurance Corporation protection.
Existing operators face a transition process
Existing businesses must apply for the appropriate license or authorization within 180 calendar days of commencement. They must register within 30 days and begin supervisory reporting within 60 days, or an earlier period prescribed by the bank.
The document requires the CBN to specify the commencement date in its issuing instrument. Those deadlines run from that date, rather than automatically from when a company reads the rules.
Continuing during the transition is conditional, limited to an operator's existing scale and subject to regulatory requirements. Continued market access for existing foreign-currency arrangements during assessment requires express interim permission. Missing the application deadline requires operations to stop until the necessary license or authorization is obtained.