Today Central Bank of Nigeria launched the eNaira after a series of delays
Reports came in last week about the government's intention to work with the Central Bank of Nigeria (CBN) to introduce the new digital currency, the eNaira, at the start of this week. The goal of the eNaira is to complement the physical naira, which is the West African country’s own currency, rather than replacing it.
The goal of a digital currency in Nigeria is to make transactions easier and seamless to process for people of all walks of life. The launch was set for the beginning of the month, but the development team encountered various issues causing things to be delayed.
The Journey of the eNaira
The currency has taken some years to develop. The CBN decided to use Bitt Inc. as its technical partner to create the currency back in August. But, it will be surprising to many who have followed cryptocurrency in Nigeria, as the government banned transactions back in February, claiming that they would become a threat to the financial system.
As we mentioned before, the eNaira was supposed to be released between October 1st-4th, but the nation’s 61st anniversary of independence slowed things down. The overreliance on cash was cited as one of the reasons to introduce a digital currency, as well as using the eNaira to bring stability to the Nigerian economy.
While it’s unlikely a large portion of the public will become early adopters, as the world moves more digital the hope is it will catch on amongst the vast majority of the population. Nigeria is a nation that boasts a huge deal of interest in crypto, so much so that it has caused the government trouble in regulating it.
There will be a wallet to accompany the eNaira, which has been developed as part of the program. In order to combat the soaring popularity of crypto, the eNaira’s wallet will allow users to choose to make payments or link it to their bank accounts.
Criticisms of the eNaira
The eNaira will be held by users directly in their digital wallets, which is purported to offer unrivalled levels of security for citizens. This differs from what is on offer in the world of DeFi, as currencies like Bitcoin aren’t backed, regulated, centralized by any state. While this is certainly unappealing to many crypto enthusiasts, the Nigerian government sees things differently.
The main criticism of centralized digital currencies, in general, is that they are pegged to the fiat currency in the country. Meaning, that those nations striving for economic prosperity aren’t doing anything new. It may also make these centralized projects very unappealing to citizens in said country.