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Nigeria To Launch A National Cryptocurrency 'eNaira'

Nigeria will launch its own national cryptocurrency 'eNaira' in partnership with Barbados-based Bitt, Nigerian banks, and other fina...

Nigeria will launch its own national cryptocurrency 'eNaira' in partnership with Barbados-based Bitt, Nigerian banks, and other financial institutions that partaking in dealing or facilitating transactions in cryptocurrencies. The Nigerian digital currency will officially launch on 1 October 2021.

Nigeria's digital currency project is set to benefit from collaboration with Bitt, the country's Central Bank announced on Monday.

According to the press release, the Barbados-based Bitt will provide technical assistance as the Central Bank of Nigeria (CBN) moves to finalize the launch of the country's digital currency dubbed "eNaira." 

The CBN said in the statement that the decision to select Bitt came from the fintech firm's various strengths, including its "technological competence, efficiency, [and] platform security". The bank also looked at the Barbados-based company's previous experience in a related project, which it helped launch in April this year.

Governor Godwin Emefiele is very optimistic about the Central Bank Digital Currency (CBDC)
The move to partner Bitt comes after an earlier announcement that the eNaira would launch on 1 October this year. It also comes on the back of the banking regulator warning banks and other financial institutions against Bitcoin and other cryptocurrencies. Commenting on the announcement, Central Bank Governor Godwin Emefiele highlighted the eNaira's capacity to improve financial inclusion, cheaper remittances and tax collection.

The eNaira is set to launch in stages and the project will see the digital currency become legal tender in Nigeria. During the initial stage, the Central Bank will issue, distribute and facilitate the redemption of the digital currency. The next phase will see registered financial institutions get the digital currency from the bank as well as overseeing the issuance of stablecoins.

In the next step, the government seeks to initiate transaction processing, which will continue with further integration across financial players, merchants, and individual users. In the fifth stage, the eNaira will feature as part of the Retail Consumer Suite, allowing for a smoother experience for customers.

Earlier on the Central Bank of Nigeria announced plans to launch its own digital currency later this year after Nigeria barred banks and financial institutions from dealing in or facilitating transactions in cryptocurrencies in February. Central Bank Governor Godwin Emefiele has said the eNaira would operate as a wallet against which customers can hold existing funds in their bank account. In a statement on Monday, Emefiele said the currency would accelerate financial inclusion and enable cheaper and faster remittance inflows.

Barbados-based Bitt earlier this year led the development of the Eastern Caribbean Currency Union's "DCash", the first digital cash issued by a currency union central bank. In related news, the first cryptocurrency ATM opened in Honduras last week as Bitcoin backers sought to spur demand for virtual assets after neighbouring El Salvador became the first country to establish Bitcoin as legal tender. Bitcoin price in India stood at Rs. 36.83 lakhs as of 11am on August 31.

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