The Central Bank of Nigeria (CBN) has introduced a regulatory framework for the operations of non-security virtual assets in the country, establishing requirements for the licensing, supervision and oversight of stablecoins, deposit money tokens and related virtual asset service providers.
The guidelines are designed to support innovation in digital payments, remittances, settlement and commerce while addressing risks associated with financial stability, monetary policy, consumer protection, illicit financial activities, operational resilience and foreign exchange management.
According to the CBN, the framework adopts a risk-based approach to regulating non-security virtual assets and seeks to safeguard the integrity, stability and efficiency of Nigeria’s financial system.
It also establishes requirements covering corporate governance, prudential standards, consumer protection, operational resilience, anti-money laundering, counter-terrorist financing and counter-proliferation financing, as well as reporting obligations for operators.
The guidelines cover the issuance, offering and distribution of regulated tokens, market access, intermediation, exchange and conversion services, fiat currency on-ramp and off-ramp services, custody, digital wallets, transfers, payment gateways, merchant acceptance, remittances, clearing and settlement.
They also extend to operators of payment and settlement infrastructure, reserve asset custodians, agents and other intermediaries involved in regulated virtual asset activities.
The CBN identified four major categories of regulated tokens: Naira-referenced stablecoins, foreign currency-referenced stablecoins, Deposit Money Tokens (DMTs) and other designated tokens that fall within its regulatory mandate.
Under the proposed classification, Class 1 stablecoins are Naira-referenced digital assets designed to maintain a one-to-one value with the local currency and backed by eligible Naira-denominated reserve assets.
Class 2 stablecoins, on the other hand, are designed to maintain a stable value against foreign currencies.
Deposit Money Tokens are digital tokens issued by Deposit Money Banks, representing direct claims on the issuing banks and corresponding to existing Naira-denominated deposit liabilities.
The guidelines provide that the CBN will determine the regulatory status of a token or virtual asset arrangement based on its economic substance, functionality and risk characteristics rather than its name, legal form, marketing description or underlying technology.
The framework also applies to virtual asset activities carried out in Nigeria, from Nigeria, or directed at individuals and businesses in the country.
Foreign issuers whose tokens are marketed, distributed or made available to Nigerians are also covered, with the CBN requiring issuers seeking access to the Nigerian market to comply with applicable incorporation, licensing and authorisation requirements.
The apex bank said an overseas location would not exempt an operator from the guidelines where its activities are directed at Nigerian customers or could materially affect the country’s payment system, financial system, foreign exchange market or financial stability.
However, the guidelines exclude Central Bank Digital Currencies issued by the CBN or other jurisdictions, as well as security virtual assets, investment products and collective investment schemes regulated by the Securities and Exchange Commission (SEC).
Electronic money and stored-value products regulated under existing payment system regulations are also excluded, unless changes in their functionality bring them within the scope of the new framework.
Other exclusions include certain bank liabilities that do not constitute deposits or Deposit Money Tokens, loyalty points, rewards programmes and vouchers restricted to limited networks and not exchangeable for money or transferable to third parties.
The CBN emphasised that the guidelines do not override the statutory responsibilities of other regulatory authorities, particularly the SEC in relation to securities and capital market products.
It said it would collaborate with other competent authorities where regulatory responsibilities overlap, including through applicable inter-agency coordination arrangements.
The framework is anchored on the Central Bank of Nigeria Act 2007, the Banks and Other Financial Institutions Act 2020, the Foreign Exchange (Monitoring and Miscellaneous Provisions) Act 1995, the Money Laundering (Prevention and Prohibition) Act 2022 and the Terrorism (Prevention and Prohibition) Act 2022.
It also aligns with the Presidential Executive Order on Virtual Assets Coordination, 2026, which provides for coordination of regulatory responsibilities in the virtual asset ecosystem.
To strengthen compliance, the guidelines introduce requirements for customer due diligence, know-your-customer procedures, identity verification, transaction monitoring and adherence to the Financial Action Task Force’s standards.
They also provide for the application of the Travel Rule and other measures aimed at improving transparency and preventing the use of virtual assets for money laundering, terrorism financing and proliferation financing.
The CBN said the framework would provide regulatory clarity for operators while ensuring that virtual asset activities develop in a manner consistent with Nigeria’s monetary, financial stability and payment system objectives.
The guidelines reinforce the CBN’s intention to accommodate innovation in digital financial services while bringing virtual asset activities with payment and settlement implications within a structured regulatory environment.
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