Central Bank of Nigeria sets new capital rules for foreign stablecoin issuers

New rules from the Central Bank of Nigeria require foreign-currency stablecoin issuers to maintain at least ₦15 billion in paid-up capital to operate in the country. This affects companies behind dollar-pegged tokens such as USDT and USDC. The rules were released on a Thursday evening. They require foreign stablecoin issuers to establish licenced entities in Nigeria and comply with local capital, reserve, and operational requirements or risk losing market access. The Central Bank of Nigeria also set a ₦10 billion minimum capital requirement for issuers of naira-backed stablecoins.

Licensing and Reserves

These regulations arrive nearly three months after the Central Bank of Nigeria opened the second cohort of its regulatory sandbox in August. That sandbox created a dedicated track for stablecoin issuers and other virtual asset companies to test products under supervision. The new framework creates a formal licencing system for stablecoins, which are digital tokens intended to maintain a fixed value against fiat currencies like the US dollar or naira. Businesses and individuals use these tokens to move money across borders, settle transactions, and access the dollar. Major issuers are pushing to expand their presence in the country. In August, Tether, the El Salvador-based company behind USDT, sought to hire an Expansion Manager in Nigeria. Circle, the US company that issues USDC, appointed Gillian Darko as its Vice President and Head of Africa. Darko is a former strategy executive at stablecoin infrastructure company Yellow Card.

Operations and Restrictions

Under the new regulations, foreign-currency stablecoins can only be offered, distributed, or made available to Nigerians through a locally incorporated and licenced issuer. Foreign regulatory approvals will not exempt companies from meeting Nigerian requirements. Issuers must maintain reserves backing their tokens, establish customer redemption arrangements, and submit regular reports to the regulator. The Central Bank of Nigeria requires monthly reserve attestations and may impose additional capital or liquidity requirements on issuers considered a risk. Existing operators have 180 days from the date regulations take effect to apply for a licence, though the Central Bank of Nigeria has not specified when that period begins. Companies must register with the regulator within 30 days and begin submitting supervisory reports within 60 days. The Central Bank of Nigeria stated that failure to submit within that period requires cessation until the required licence or authorisation is obtained. Foreign-currency stablecoin operators face scrutiny over incorporation, licencing, and distribution arrangements, and companies seeking to continue operating while applications are reviewed must obtain explicit regulatory permission. The new rules ban algorithmic stablecoins, which rely primarily on adjustments to token supply to maintain value without sufficient reserve backing. The Central Bank of Nigeria seeks greater oversight of non-security virtual assets used for payments. Stablecoins play an emerging role in how businesses and merchants move money across borders, source foreign exchange, and how fintechs access dollar liquidity for international payments and settlements.