Nigeria is apparently launching its first regulated Naira stablecoin called cNGN following the lifting of a two-year ban on cryptocurrency trading through official channels.
The new stablecoin cNGN is being developed by a consortium of Nigerian banks, fintechs, and blockchain businesses and will be consistent with the regulations set by the stakeholders and controlled Naira stablecoin.
The Nigerian Naira would be pegged 1:1 to cNGN, but unlike previous stablecoin drafts, it will be owned by Nigerian banks and will be legal money.
According to Forbes, the debut is scheduled for 2024.
cNGN, however, will be a cryptocurrency, like other stablecoins, rather than a digital money, as in prior versions.
This comes after the Central Bank of Nigeria lifted the prohibition on cryptocurrency transactions last week.
The coin will be serviced by the consortium and owned by its banks.
In February 2021, the central bank, led by Mr Godwin Emefiele, forbade credit institutions from doing cryptocurrency-related activities. Many bitcoin firms were affected, forcing them to revise their product offers.
The lifting of the restriction stems from the realization that cryptocurrencies play a significant role in global financial systems, and its use in Nigeria, which is one of the currency’s fastest users, is unavoidable.
