The cryptocurrency craze has spread to two of West Africa’s largest economies, which are also planning to launch their own central bank digital currencies. Both countries are said to have partnered with offshore financial technology firms to achieve the aforementioned objectives.
Nigerian and Ghanaian central banks have issued digital currencies.
As previously stated, the central banks of Nigeria and Ghana have partnered with fintech firms to make their CBDC dreams a reality. The former, Africa’s largest economy, is expected to launch their digital currency dubbed eNaira on October 1, while Ghana will conduct trials for their so-called e-Cedi this month.
Chapel Hill is a city in North Carolina. Ayodeji Ebo, Denham’s Head of Retail Investment, stated that Nigerians are investing in cryptocurrency as a means of storing value as well as carrying their funds outside of the country’s borders. He went on to say that the eNaira will be used for transactions.
Despite the fact that banks in the country are prohibited from transacting in such digital assets, the popularity of cryptocurrency in Nigeria has skyrocketed. People are also looking for ways to get away from the dwindling naira (Nigeria’s national currency) and offset the country’s high cost of living and unemployment.
After more than three years of research into cryptocurrency, the country chose Bitt Inc. as the fintech company for its CBDC launch known as Project Giant.
According to the Central Bank of Nigeria, they will rely on Bitt’s tested and proven digital currency experience, which is already in circulation in some eastern Caribbean countries. Furthermore, the soon-to-be-released eNaira will be issued as legal tender by the CBN, just like its physical counterpart, and will run on the Hyperledger Fabric Blockchain. It will use the official exchange rate as soon as it goes live.
On October 1, Nigerians will be able to download the eNaira app, which will be used to fund their mobile wallets using their existing bank accounts. According to CBN Governor Godwin Emefiele, this is the case.
Despite such efforts, the Nigerian central bank is concerned about the impact of cryptocurrency and stablecoins on the country, as their popularity has grown among the country’s young and tech-savvy population.
e-Cedi in Ghana
Ghana is collaborating with Giesecke+Devrient (G+D), a German firm that will pilot the e-Cedi. Furthermore, such a move is thought to be just one of several plans to digitize both the country and its government. G+D will be tasked with providing the necessary technology, which will be tested in a so-called trial phase with Ghanaian banks, consumers, and others.