Nigeria's central bank licenses stablecoins, bans algorithmic ones

The Central Bank of Nigeria (CBN) has introduced a licensing regime for stablecoin issuers and other providers of non-security virtual asset services. According to The Block, the rules took effect on Nov. 5, 2026 and explicitly ban algorithmic stablecoins.

Details

Naira-referenced and foreign-currency-referenced stablecoins get separate licence categories. Foreign-currency stablecoins can operate in Nigeria only through a Nigerian-incorporated entity holding a Foreign Currency Issuer Licence, and each token needs written approval covering its classification, reference currency, reserves, name, ticker and blockchain networks.

Gazette reports minimum paid-up capital of ₦10 billion for naira stablecoin issuers and ₦15 billion for foreign-currency issuers, and ₦1 billion for other virtual asset services. Existing operators must register with the CBN within 30 days, begin supervisory reporting within 60 days and file a full licence application within 180 days, or stop operating until they are licensed.

The rules cover any activity conducted in Nigeria, aimed at Nigerian users or affecting the country's payments system and foreign exchange market, even without a physical presence. Operators must run customer due diligence, sanctions screening, transaction monitoring and Travel Rule compliance. The CBN oversees payment-related virtual assets, while the Securities and Exchange Commission keeps authority over assets classed as securities.

What it means for the market

Nigeria is one of the busiest markets for dollar stablecoins such as Tether and USDC, used for payments and savings. The capital and local-entity requirements could push out smaller foreign issuers and P2P services that fail to secure a licence within 180 days. Reports so far don't say how the rules will be applied to global stablecoins already in use there.

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