Nigeria’s Anti-Fintech Central Bank Prepare To Launch Digital Naira
The Central Bank of Nigeria (CBN), which has been much on the anti-fintech and -crypto side, now have plans to launch a digital naira pilot program later in October 2021, as part of its central bank digital currency project (CBDC).
Regardless, the country’s central bank has increased its investment and research into cryptocurrency’s underlying technology, blockchain, and has set a firm deadline for the launch of its blockchain-powered central bank digital currency pilot project (CBDC).
According to the Peoples Gazette, the CBN made the revelation during a webinar to stakeholders. CBN announced that it would not be left out of the ongoing CBDC activities taking place throughout the world, China being the front runner.
The central bank stated that the CBDC plan will facilitate cross-border trade while also allowing for macro-management and growth.
The planned digital naira would also help with remittances and monetary policy, as well as financial inclusion and tax collection. The information technology director for the bank, Rakiya Mohammed, disclosed that CBN had been researching since 2017 to develop and adopt the digital currency.
The Central Bank Of Nigeria effort comes as countries around the world expressed interest in embracing digital assets and currencies.
Bank of Ghana has also been rapidly approaching the pilot stage for its own central bank digital currency this summer. The country has established itself as a continent leader in CBDC development, believing that central bank-issued digital currencies are superior to and less hazardous than decentralized cryptocurrencies.
The United Arab Emirates (UAE) is also planning to launch a CBDC. Other countries include Vietnam, Israel, South Korea, Jamaica, New Zealand, Japan, France, and Singapore. Meanwhile China (digital yuan), Bahamas (sand dollar), Eastern Caribbean (DCash) are among the few countries that have officially launched their own national digital currencies.
Nigeria’s Crypto Ban and Fintech Boycott
Earlier in 2021, the country’s central made cryptocurrency transactions illegal, warning that they might lead to investment losses, money laundering, terrorism financing, illegal capital flows, and other criminal activity.
“Cryptocurrencies have become well-suited for conducting many illegal activities including money laundering, terrorism financing, purchase of small arms and light weapons, and tax evasion. Indeed, many banks and investors who place a high value on reputation have been turned off from cryptocurrencies because of the damaging effects of the widespread use of cryptocurrencies for illegal activities.”
Could the launch of the digital naira a turn in policy for the Central Bank?
