During a webinar, the Central Bank of Nigeria and its stakeholders shared their plans to activate a central bank digital currency (CBDC) by October.
Central Bank of Nigeria (CBN) has revealed that the facility will start a CBDC pilot project from October 1. announcement came during a digital webinar where the digital currency initiative was shared with stakeholders as originally reported.
pilot scheme, dubbed ‘GIANT’, will be the largest step CBN has taken in developing a CBDC since development began in 2017. GIANT will run on the open source Hyperledger Fabric blockchain, commonly used to develop blockchain products. Private entities.
central bank’s chief information technology officer, Rakiya Mohammed, said the bank could even conduct a proof of concept by the end of 2021 if all goes well with the pilot program.
Despite mixed sentiments about cryptocurrency in Nigeria, the CBN noted that around 80% of the world’s central banks are on the same path to CBDCs and do not want to be left in the dust. bank said the launch would be done in a way that would allow both macro management and cross-border growth and trade. Publishing the CBDC would also provide a number of other benefits, including income tax collection, financial inclusion, and targeted social intervention.
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Nigeria’s hot / cold relationship with cryptocurrencies
Nigeria, at one point in 2020, was the second largest bitcoin trader globally. But since then, the country has had its fair share of problems that have made Nigeria’s stance on crypto a bit confusing. CBDC developments continue despite stories like Nigeria’s SEC blocked all cryptocurrency-related activities in February due to disagreements with CBN or a ban on commercial banks from doing business with cryptocurrency exchanges.
reason given by the CBN was shared in a press release from the bank in February. Referring to cryptocurrencies, the CBN version states that “the fact that they are issued by unregulated and unlicensed entities, their use in Nigeria goes against the key mandates of the CBN, enshrined in the CBN Act (2007), as an issuer . In fact, the use of cryptocurrencies in Nigeria is in direct violation of existing law.
It is also important to note that there is a fundamental difference between a digital currency issued by a central bank and cryptocurrencies. As the names suggest, while central banks can issue digital currencies, cryptocurrencies are issued by unknown and unregulated entities.
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