Nigeria e-Naira to roll out on the 1st of October – CBN

[Martin Everson]

e-Naira to roll out on the 1st of October – CBN

The Central Bank of Nigeria (CBN) revealed on Wednesday that it has concluded plans for the launch of its Central

nairametrics.com

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The Central Bank of Nigeria (CBN) revealed on Wednesday that it has concluded plans for the launch of its Central Bank Digital Currency (CBDC), the e-Naira on the 1st of October.

This was disclosed by the CBN’s Director of Information Technology, Rukiya Mohammed, on Wednesday, in a webinar, themed: “Digital currency and the prospects of CBDC in Nigeria,” organised by the Committee of e-Business in Industry Heads (CeBIH).

The CBN director said 85% of Central Banks globally were working on their digital currency, citing rising digital payments in Nigeria compared to cash payments, which is declining in Nigerian also.

“CBDC would contribute to macro-economic growth in the country. If people adopt more of the usage of the e-naira, it would enhance more data to formulate macroeconomic policies,” she said.

“Also, when more countries have their own digital currencies, it would increase the exchange of currency and facilitate cross border trade at a lower cost.

“Even though Nigeria has a good payment system, this would also improve Nigeria’s payments efficiency,“ she said.

She added that the CBN will partner with currency technology providers including MasterCard, stating that the CBN would focus on low amount payments at the introductory stage and instant settlement with low cost.

“CBDC would be legal tender with one e-Naira equivalent to one naira which shows fundamental differences between CBDC and crypto currencies,” she said.

Dr Adesola Adedutan, the Managing Director of First Bank Nigeria said that there are significant differences between CBDCs and cryptocurrencies, citing that CBDC provides a platform for the governments to leverage blockchain technology to maintain a centralised and institutional role over of the currency.

What you should know​

The e-Naira will be a digit representative of the paper Naira currency issued by the Central Bank of Nigeria. The e-Naira will be a “complementary” legal tender in Nigeria, having the same exchange value as the Naira, and maintaining a “parity of value” with the Naira.

The e-Naira will not earn any interest to holders. The e-Naira is built on a blockchain open ledger technology. Creating the e-Naira on the blockchain means you cannot have a duplicate or fake e-Naira. Each e-Naira note will be unique.

Is the e-Naira a stablecoin?​

In a previous article by Nairametrics, a stablecoin was defined as a cryptocurrency backed by reserves. The keyword is reserves, but what kind of reserves? Stablecoins are backed by holding an equal equivalent of FIAT money like the US dollar. FIAT means government-issued but usually not backed by any commodity, e.g gold.

Thus, a stablecoin like USDT is tied to a currency, the US dollar, and maintains a stable exchange value. To be a stablecoin, the eNaira has to be tied to a currency like the US Dollar or Euro or even the Yuan.

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[marioIT]

oh f**k now the nigerian prince scam emails in my spam folder are going to skyrocket.

 

[JackAlabama]

e-Naira to roll out on the 1st of October – CBN

The Central Bank of Nigeria (CBN) revealed on Wednesday that it has concluded plans for the launch of its Central

nairametrics.com

---- quote start

The Central Bank of Nigeria (CBN) revealed on Wednesday that it has concluded plans for the launch of its Central Bank Digital Currency (CBDC), the e-Naira on the 1st of October.

This was disclosed by the CBN’s Director of Information Technology, Rukiya Mohammed, on Wednesday, in a webinar, themed: “Digital currency and the prospects of CBDC in Nigeria,” organised by the Committee of e-Business in Industry Heads (CeBIH).

The CBN director said 85% of Central Banks globally were working on their digital currency, citing rising digital payments in Nigeria compared to cash payments, which is declining in Nigerian also.

“CBDC would contribute to macro-economic growth in the country. If people adopt more of the usage of the e-naira, it would enhance more data to formulate macroeconomic policies,” she said.

“Also, when more countries have their own digital currencies, it would increase the exchange of currency and facilitate cross border trade at a lower cost.

“Even though Nigeria has a good payment system, this would also improve Nigeria’s payments efficiency,“ she said.

She added that the CBN will partner with currency technology providers including MasterCard, stating that the CBN would focus on low amount payments at the introductory stage and instant settlement with low cost.

“CBDC would be legal tender with one e-Naira equivalent to one naira which shows fundamental differences between CBDC and crypto currencies,” she said.

Dr Adesola Adedutan, the Managing Director of First Bank Nigeria said that there are significant differences between CBDCs and cryptocurrencies, citing that CBDC provides a platform for the governments to leverage blockchain technology to maintain a centralised and institutional role over of the currency.

What you should know​

The e-Naira will be a digit representative of the paper Naira currency issued by the Central Bank of Nigeria. The e-Naira will be a “complementary” legal tender in Nigeria, having the same exchange value as the Naira, and maintaining a “parity of value” with the Naira.

The e-Naira will not earn any interest to holders. The e-Naira is built on a blockchain open ledger technology. Creating the e-Naira on the blockchain means you cannot have a duplicate or fake e-Naira. Each e-Naira note will be unique.

Is the e-Naira a stablecoin?​

In a previous article by Nairametrics, a stablecoin was defined as a cryptocurrency backed by reserves. The keyword is reserves, but what kind of reserves? Stablecoins are backed by holding an equal equivalent of FIAT money like the US dollar. FIAT means government-issued but usually not backed by any commodity, e.g gold.

Thus, a stablecoin like USDT is tied to a currency, the US dollar, and maintains a stable exchange value. To be a stablecoin, the eNaira has to be tied to a currency like the US Dollar or Euro or even the Yuan.

---- end quote

Will they aridrop their sh*coin to the populace? I wonder if I can sign up

 

[Martin Everson]

Will they aridrop their sh*coin to the populace? I wonder if I can sign up

I wonder if it can be used internationally i.e it will be a liberated currency unlike the current Naira. Would be a shame if they missed the opportunity to create the Chinese equivalent of the CNH.

 

[Martin Everson]

Ok so I read a bit more about it here:

E-Naira Registration 2023 – ENaira app Download – How to Register for E-Naira wallet | E-Naira wallet Login

E-Naira Registration 2023 – ENaira app Download – How to Register for E-Naira wallet | E-Naira wallet Login. Brace up guy as the Central Bank of Nigeria (CBN) plans to launch a digital …

infoguidenigeria.com

So basically Nigerians can bypass local banks and bank directly with the CBN after local banks retail the E-Naira to them. Hence moving liability to the CBN from bank credit .

I like the idea of removing retail bank credit liability. Now if only ECB can release a digital currency and I can bypass banks (and just 100k deposit insurance) and move my liability to ECB .

 

[JackAlabama]

Ok so I read a bit more about it here:

E-Naira Registration 2023 – ENaira app Download – How to Register for E-Naira wallet | E-Naira wallet Login

E-Naira Registration 2023 – ENaira app Download – How to Register for E-Naira wallet | E-Naira wallet Login. Brace up guy as the Central Bank of Nigeria (CBN) plans to launch a digital …

infoguidenigeria.com

So basically Nigerians can bypass local banks and bank directly with the CBN after local banks retail the E-Naira to them. Hence moving liability to the CBN from bank credit .

I like the idea of removing retail bank credit liability. Now if only ECB can release a digital currency and I can bypass banks (and just 100k deposit insurance) and move my liability to ECB .

They can put directly a negative interest rate to your account and if you're too rich for their liking that interest rate can be adjusted upwards (it is for the common good and helping the poor, the covid destroyed and the environment) also any critical post about the glorious EU can result in a blockade of your funds held at the ECB

 

[Martin Everson]

They can put directly a negative interest rate to your account and if you're too rich for their liking that interest rate can be adjusted upwards (it is for the common good and helping the poor, the covid destroyed and the environment) also any critical post about the glorious EU can result in a blockade of your funds held at the ECB

Well thats the end goal of any CBDC alongside bypassing banks in the local economy to enact direct monetary policy on the people.

 

[JackAlabama]

Well thats the end goal of any CBDC alongside bypassing banks in the local economy to enact direct monetary policy on the people.

very true indeed.

 

[Marc Rich]

nice!!! but how was I informed by this on here instead of my lawyer in Lagos lol

 

[lacomaco]

Well thats the end goal of any CBDC alongside bypassing banks in the local economy to enact direct monetary policy on the people.

What about lending? How banks would be able to lend if “all” liquidity and savings will be kept at the CB?

 

[Martin Everson]

What about lending? How banks would be able to lend if “all” liquidity and savings will be kept at the CB?

You wont need a bank to get a loan in future. Banks lending to people against your deposits will be replaced by how current token staking works. In future the general public will be your lender via government backed smart contracts with no real middle man.

 

[lacomaco]

You wont need a bank to get a loan in future. Banks lending to people against your deposits will be replaced by how current token staking works. In future the general public will be your lender via government backed smart contracts with no real middle man.

So you say that the central banks will let the general public to define loan conditions? LTVs? What about risk control and risk management? Who will deal with malinvestment? Who will decide whether to ease lending or restrict because of an overheating economy? The general public? Come on...

 

[Martin Everson]

So you say that the central banks will let the general public to define loan conditions?

Central bank smart contracts will define loan conditions for the public.

LTVs?

This will be based on your spending habits, saving habits, digital assets that are viewable on-chain. It will be automated again via smart contracts.

What about risk control and risk management?

Much of risk has been automated already for many years ask a bank or brokerage firm.

Who will decide whether to ease lending or restrict because of an overheating economy?

The Central Bank will decide. They will hit a key and rates will go negative and money will start to disappear from your wallet. You will be forced to invest, spend or lend (stake) your digital money just to maintain your wealth - and that is how they will directly control the economy. It goes without saying they can do the opposite and grant you interest on your digital money.

Bottom line no one holding government digital money will be forced to use a private institution such as a bank to hold their wealth or transact. The traditional role of the bank will be gone.

 

[Dreamy]

Btc is very popular there, I don't think that they will use this government coin like they use now btc