Earlier, we reported that CBN has lifted ban on cryptocurrency transaction directly from your bank account. Now, Nigerian banks are working on creating a stable coin dubbed has cNGN following the liftig of the ban.
According to report, commercial banks like First Bank, Access Bank, Sterling Bank, and Providus Bank; payment infrastructures like Kora (formerly Korapay), Interswitch, and Budpay; and Blockchain consultants like Interstellar (Blockchain infrastructure company) and Convexity (Blockchain consultants) are the key partners, expected to execute the project.
cNGN token will maintain a one-to-one peg with every Naira (₦1) held by all banks in the country. It will have the same functionality of major stablecoins like Tether (USDT), USD Coin (USDC), and Binance USD (BUSD), the cNGN token will have interoperability capabilities with other public blockchains. This will allow it to expand its utility beyond Nigeria by seamlessly facilitating global transactions.
Stablecoins are cryptocurrencies with values tied to those of an existing fiat currency, commodity, or financial instrument (contracts for monetary assets that can be created, bought, traded, modified, or settled for).
My Thoughts
If you can recall, CBN prohibited cryptocurrency activities the same year it introduced the eNaira, a Central Bank Digital Currency (CBDC) distinct from the cNGN stablecoin. Personally, thought the eNaira was suppose to play the role of the cNGN token, but it didn’t; so I had to delete the app completely. I want to believe this contributed to the reason why most Nigerians stop using the enaira app.
Report has it that the cNGN stablecoin will be launched in January 2024 if everything goes according to plan. We await more information on this development.