CBN Approves Launch Date for Naira Stablecoin by Nigerian Banks and Fintech Firms
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The Central Bank of Nigeria (CBN), along with financial institutions and fintech firms, has finalized plans for the launch of the first naira stablecoin. The cNGN stablecoin is set to be launched on February 27, 2024, and will be pegged at a 1:1 ratio to the naira. This initiative aims to allow users to transact globally using the naira, reducing traditional challenges associated with currency conversion and international transaction fees.
The stablecoin, managed by the Africa Stablecoin Consortium (ASC), is seen as an effort by the CBN to enhance the stability and global usability of the naira. The cNGN will be interoperable with strategic blockchains such as Bantu and Binance Smart Chain. Unlike the eNaira, the cNGN is developed and managed by a consortium, marking a shift in the approach compared to the previous digital currency initiative under former CBN Governor Godwin Emefiele.
This move follows the lifting of the ban on cryptocurrency trading in Nigeria by the CBN, and the collaboration between Nigerian banks and fintech firms reflects the growing interest in developing and managing stablecoins for the benefit of token holders and the Nigerian economy. The cNGN, similar to well-known stablecoins like USDT and USDC, is expected to facilitate straightforward international transfers and contribute to its global adoption.