By Tony Obiechina, ABUJA
The Central Bank of Nigeria (CBN) has introduced a comprehensive regulatory framework for non-security virtual assets service providers (VASPs), including stablecoins and deposit money tokens dealers, as part of its sustained regulatory measures to strengthen its oversight of emerging digital financial services in the country.
The Bank, in a circular with Ref. No PSP/DIR/PUB/CIR/001/004 dated November 5, 2026 and signed by its Director. Payments System Policy Department, Musa Jimoh, indicated that the new regulations established licensing, authorisation and supervisory requirements for virtual asset issuers and service providers operating in or targeting the Nigerian market and were designed to promote responsible innovation, strengthen the integrity of the financial system and provide an appropriate regulatory framework for emerging digital payment instruments..
Under the new framework titled ‘Regulations for the Operations of Non-Security Virtual Assets in Nigeria’, stablecoin issuers, virtual asset service providers and other regulated operators will be subject to requirements covering licensing, capital adequacy, reserve backing, liquidity and redemption arrangements.
While also prescribing standards for corporate governance, risk management, internal controls, cybersecurity and operational resilience, the framework also directed the operators to comply with requirements for safeguarding customer assets, making appropriate disclosures and establishing effective complaints management systems.
In addition, the framework also introduced measures to address financial crime risks associated with digital asset transactions, including anti-money laundering and counter-terrorist financing obligations, sanctions screening, transaction monitoring and blockchain analytics.
The framework also mandates virtual asset service providers to comply with the Travel Rule and conduct due diligence on counterparties, particularly other virtual asset service providers involved in transactions.
The latest regulations apply to individuals and organisations conducting regulated activities in or from Nigeria, directing such activities at Nigerian customers or undertaking operations that could materially affect the country’s payment system, financial system, foreign exchange market or financial stability.
According to the apex bank the requirements could apply irrespective of whether an operator maintains a physical presence in the country, which implies that foreign virtual asset operators targeting Nigerian customers or undertaking activities with material implications for the country’s financial system may also fall within the regulatory framework.
The CBN clarified, however, that the new regulations did overrule the statutory responsibilities of the Securities and Exchange Commission (SEC) or other competent authorities, stressing that activities involving security virtual assets, securities, investment contracts and other capital-market products would remain subject to the applicable capital-market regulatory framework.
The framework further provides that where an activity involves both non-security virtual assets and matters under another regulator’s jurisdiction, operators are required to obtain the relevant approvals from each competent authority.
The apex bank mandated all the affected financial institutions, issuers, service providers, operators and other stakeholders to familiarize themselves with the regulations and ensure strict compliance with the applicable licensing, prudential, operational, reporting and technology requirements.
As a deterrent to abuses, the framework also provides for regulatory enforcement, administrative sanctions and orderly wind-down arrangements for operators unable to continue their regulated activities.
