CBN Launches Regulatory Sandbox for Virtual Asset Operators in Nigeria

Nigeria's Central Bank has launched a regulatory sandbox for virtual asset operators, fintechs, financial institutions, and technology companies. The sandbox marks the country's latest move to regulate the virtual asset industry.

The CBN will oversee virtual assets used for payments, including stablecoins, payment, settlement, custody, wallet management, and other transaction-based infrastructure services. Meanwhile, the Nigerian Securities and Exchange Commission (SEC) will oversee digital assets that behave like securities.

The new sandbox includes a Virtual Asset Service Provider (VASP) track for companies offering stablecoins, payment and settlement services, custody, wallets, and related financial infrastructure solutions. It also includes a Data-Enabled Financial Services (Non-VASP) track for firms using secure digital infrastructure and permission-based data sharing to improve payments, credit, risk management, operational efficiency, and financial inclusion.

Eligible virtual asset companies will have their first opportunity to enter the CBN's supervised testing environment under Nigeria's newly coordinated virtual assets regime during the application window. Successful applicants must comply with safeguards covering consumer protection, operational resilience, cybersecurity, and regulatory reporting.