Is Nigeria going for a central bank digital currency?

Is Nigeria going for a central bank digital currency?

It is starting to look like Nigeria is going to have its own central bank digital currency (CBDC) by the end of the year. That is, if we have to believe an official with the Central Bank of Nigeria (CBN). Following a meeting of the country’s bankers’ committee, CBN IT Director, Rakiya Mohammed, revealed that this “digital currency would be accessible to all Nigerians.”

In a report by Nigeria Today, the IT director was quoted saying that the CBN’s digital currency will be unlike privately issued cryptocurrencies such as bitcoin, which a Nigerian senator has previously blamed for making the naira currency “almost useless.” Mohammed said:

“We have spent over two years studying this concept of the central bank digital currency and we have identified the risks. And it is one of the reasons why I said we are setting up a central governance structure that would involve all industry stakeholders to access all the risks as we continue on this journey.”

Muhammed also hinted that the CBN will be making an announcement on the date for the CBDC launch “very soon”.

It seems Nigeria’s plans regarding its CBDC have to be taken seriously. Mohammed is already the second CBN official to suggest that a digital currency roll-out is in the making. Less than a month ago, CBN governor Godwin Emefiele commented on digital currency, saying they would “come to life even in Nigeria.”

Crypto ban

Both of the CBN officials’ comments on the possibility of a CBDC come a few months after the CBN put some restrictions on the country’s banks to stop extending their services to cryptocurrency entities. Cryptocurrency exchanges and other crypto start-ups were blamed for fueling foreign currency shortages and for causing the naira’s depreciation on the black market. Nonetheless, peer-to-peer crypto trading was up 30% shortly after the government ban.

When looking at other nations worldwide and their progress with regards to their CBDC’s, with only six months left before the year ends, it seems doubtful that Nigeria will have its own up and running by then.

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Source: igaming