On one hand, Nigerian Central Bank (CBN) is bent upon discrediting cryptocurrencies while on the other hand, it is working on the project of Central Bank Digital Currency (CBDC). In an effort to win the hearts of Nigerians, CBN has announced that before the end of 2021, it will be launching the promised CBDC. The bank also revealed that after the launch of CBDC, investors will be able to trade cryptocurrencies through CBDC. But would be it enough to make the investor’s general public happy?
CBN had earlier issued a directive aiming towards discrediting cryptocurrencies by the banks operating in the country. Upon receiving directives, the banks were forced to warn their customers to refrain from any type of crypto trading. Meanwhile, the bank accounts belonging to Nigerian crypto exchanges were suspended. Exchanges were asked to withdraw their funds on very short notice. This led to a tussle between crypto investors and the banks including CBN.
In the meantime, the national currency was continuously devaluated by CBN which resulted in customers going to exchanges. However, the exchanges denied accepting old US Dollar bills and some exchanges paid less again a dollar bill. At that point in time, CBN came into action and warned exchanges to immediately suspend such activities. But the love of Nigerian investors for crypto remained intact. They continued raising their voices against the directives of CBN. In an effort to lower their voices, CBN told them that very soon CBN will launch its CBDC. This gave the investors some hope but until then they can’t actually trade in cryptocurrencies.
The investors then continued to trade crypto without the knowledge of CBN through the black market.
Now CBN has come up with a new tactic for ensuring that the investors’ interests in crypto are kept alive. While their concerns of crypto trading can be addressed by providing them further hope.
CBN’s IT Director has informed us that CBN will be in the position to launch the promised CBDC before the end of 2021. The Director stated further that when CBDC is launched there won’t be any restriction regarding crypto trading upon any crypto investor. The investors would be able to acquire digital currencies and assets by using their own national CBDC. He also made mention the fact that the official announcement will soon be made by CBN itself.
This is the second statement with regard to Nigerian CBDC. The first statement was of CBN’s Governor when Godwin Emefiele in May who stated that Nigerian CBDC will join the national economy soon.
This is a good sign for crypto in Nigeria. Even CBN has instructed all the banks to continue to render banking services to crypto customers and crypto exchanges.