The Central Bank of Nigeria (CBN) will launch a pilot program for its own digital currency on October 1st, 2021, after four years of research. The CBDC project, dubbed “GIANT,” will run on the Hyperledger Fabric modular blockchain technology.
Nigeria does not want to fall behind the rest of the world.
The Central Bank of Nigeria disclosed at a recent webinar that it had established a firm date for beginning a pilot for its CBDC — October 1st. Rakiya Mohammed, the CBN’s information technology director, emphasized the move, noting that the institution spent four years researching and creating the initiative.
According to reports, the pilot program will be known as “GIANT” and will run on the permissioned blockchain infrastructure Hyperledger Fabric. Mohammed also stated that the CBN could conduct a proof of concept test by the end of 2021.
During the webinar, leading Nigerian bankers pointed out that about 80% of central banks around the world are actively attempting to issue their own CBDC.
Nigeria wants to focus on rising regional challenges such monetary policy efficacy, revenue tax collection, enhanced payment efficiency, remittance improvement, financial inclusion, and targeted social intervention with the support of this future initiative. Furthermore, the CBN stated that an e-naira would facilitate cross-border trading.
Nigerians are enamored with digital assets.
Nigeria is one of Africa’s most active cryptocurrency markets, with millions of young Nigerians turning to digital assets to address their financial woes.
However, the CBN has put limitations on virtual currency transactions, asking domestic banks to quit servicing bitcoin clients. Many criminal organizations utilize the asset to facilitate money laundering and even finance terrorism, according to the institution. However, the central bank reversed its position a few weeks later, stating that it is fine with cryptocurrencies and does not discourage people from trading them.
While many predicted that the barrier would endanger the market’s size and shrink it, this did not happen. Despite the CBN’s prohibition, Nigerians remained optimistic, and the country became Paxful’s largest peer-to-peer market. Over 1.5 million local platform users are said to have traded $1.5 billion in a single day.