The Central Bank of Nigeria (CBN) had publicly asserted that the eNaira, central bank digital currencies (CBDC) initiative, does not threaten the nation’s financial stability.
The CBN issued a press release on October 9 in response to “news articles on some media platforms” suggesting the eNaira threatens Nigeria’s financial stability.
Some news articles, such as one published in the Nigerian Daily Punch, reference the CBN’s recently published report titled “Economics of Digital Currencies: A Book of Readings.”
In the report, CBN experts emphasize the gradual increase of eNaira adoption, which represents 0.2% of the liquidity of Nigerian banks. They also acknowledge that commercial banks cannot access the funds held by citizens in eNaira wallets.
The very hypothetical hazard that could result from this observation is the lack of liquidity the banks would experience in the event of eNaira’s complete adoption. However, this dread is one of the most fundamental theoretical aspects of any CBDC discussion.
In its release, the CBN provides limited explanation, limiting itself to a simple denial of media claims and a reference to its report’s “in-depth understanding of CBDCs.”
“The eNaira structure continues to evolve and undergo modifications targeted at improving the user experience across all interfaces. We encourage Nigerians to embrace the technology for, amongst other things, greater financial inclusion.”
A recent global survey with participants from 15 countries reveals that Nigeria has the world’s most cryptocurrency-savvy population. According to a joint study by ConsenSys and YouGov, 99 percent of Nigerians are more knowledgeable about Web3 than individuals in major economies such as the United Kingdom, the United States, Japan, and Germany.
