eNaira Adoption Grows Amid Nigeria’s Cash Shortages

Nigeria’s central bank launched its own digital currency, the eNaira, in 2021, and nearly 18 months later, the CBDC is seeing increased adoption in the country. The acute cash shortage in Nigeria is due to the central bank’s decision to replace older banknotes with bigger denominations, which has caused severe shortages in national fiat reserves. In a country where cash accounts for about 90% of transactions, the lack of physical cash has forced Nigerians to turn to the eNaira.

According to a recent Bloomberg report, the value of eNaira transactions has increased by 63% to 22 billion nairas ($47.7 million), indicating a growing adoption of the CBDC. Furthermore, the total number of eNaira wallets has grown more than 12 times compared to October 2022, and is currently at 13 million, as reported by Godwin Emefiele, the governor of the Central Bank of Nigeria.

The demonetization, which reduced the circulating cash supply from 3.2 trillion nairas to 1 trillion nairas, prompted Nigeria to mint over 10 billion eNairas to compensate for the decline. The use of eNaira payouts in government initiatives and social schemes has also contributed to the increase in CBDC adoption.

For developing countries like Nigeria, CBDCs present a way to overcome challenges presented by the fiat economy, including reducing operating costs and strengthening Anti-Money Laundering initiatives. The eNaira, in particular, has emerged as the electronic payment channel of choice for financial inclusion and executing social interventions, according to Emefiele.

In addition to the increased adoption of the eNaira, Nigerians have also been presented with another option for procuring cryptocurrencies. MetaMask’s parent firm ConsenSys recently announced a new MoonPay integration, which allows Nigerians to purchase crypto via bank transfers. This new feature is available within the MetaMask mobile and Portfolio DApp, significantly simplifying buying crypto without using credit or debit cards in Nigeria.

It is clear that the adoption of CBDCs like the eNaira in Nigeria is becoming increasingly important in the face of cash shortages and other economic challenges. The use of digital currencies presents a viable solution to revamp the fiat capabilities of developing nations and to provide greater financial inclusion to citizens. As such, it will be interesting to see how the adoption of eNaira and other CBDCs continues to evolve in Nigeria and beyond.


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Nigerian President-elect’s Manifesto Includes Blockchain and Crypto Regulations

Nigeria is one of the countries where cryptocurrency adoption is on the rise. In recent years, the country has seen a surge in crypto trading and the use of cryptocurrencies for cross-border payments, remittances, and e-commerce. However, the lack of clear regulations and guidelines for the use of cryptocurrencies has been a hindrance to the growth of the sector.

To address this issue, Bola Tinubu, the Nigerian President-elect, has released a manifesto that includes proposals for the use of blockchain technology and cryptocurrencies in Nigeria’s banking and finance sector. The manifesto proposes a review of the existing Nigerian Security Exchange Commission regulations on digital assets to make them more business-friendly.

The proposed reforms would require digital asset companies to register with the SEC and comply with SEC regulations. The manifesto also proposes the establishment of an advisory committee to review the SEC regulations on digital assets to create a more efficient and business-friendly regulatory framework. The proposed regulations would enable the use of cryptocurrencies and other digital tokens in Nigeria’s banking and finance sector, as well as in identity management, revenue collection, and other areas.

The government hopes that the proposed reforms to the SEC regulations will help attract more investors in the digital and economic sectors and stimulate economic growth. The manifesto also aligns with the Central Bank of Nigeria’s eNaira, the country’s central bank digital currency. The government plans to expand the adoption of the eNaira, which has not lived up to expectations since its launch.

However, some cryptocurrency enthusiasts have criticized the existing regulations for lacking provisions that allow crypto users to transact with their local banks. The proposed reforms to the SEC regulations would address this issue and provide a framework for regulating digital assets like cryptocurrencies and other digital tokens in Nigeria.

The release of the manifesto coincides with the increasing adoption of cryptocurrencies in Nigeria, which is among the highest in the world. According to a report by Chainalysis, Nigeria ranks second in the world in terms of cryptocurrency adoption, after Ukraine. The report notes that Nigeria’s high adoption of cryptocurrencies is driven by a variety of factors, including high remittance fees, currency volatility, and a large young population with a high level of technology adoption.

The Nigerian government’s interest in cryptocurrencies is also reflected in the Central Bank of Nigeria’s milder position towards stablecoins. The bank recently published a research report titled “Nigeria’s Payment System Vision 2025,” which explores the creation of a new framework to introduce a stablecoin in Nigeria.

In conclusion, Bola Tinubu’s manifesto includes proposals for the use of blockchain technology and cryptocurrencies in Nigeria’s banking and finance sector. The proposed reforms to the SEC regulations would enable the use of cryptocurrencies and other digital tokens in Nigeria’s banking and finance sector, as well as in identity management, revenue collection, and other areas. The government hopes that the proposed reforms will help attract more investors in the digital and economic sectors and stimulate economic growth.


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Nigeria’s eNaira Records 200,000 Transactions Worth Over $10 Million Since October

Godwin Emefiele, the Governor of the Nigerian Central Bank, said on Thursday that the eNaira, Nigeria’s Central Bank Digital Currency (CBDC), is expected to enter the second phase of its expansion through new technology to increase its user base.

The Central Bank Governor delivered a speech in eNaira Hackathon event on Thursday where he talked about the progress and related developments regarding eNaira, Africa’s first ever CBDC launched in October last year.

Mr. Emefiele said the second phase of the national digital currency project has begun and is focused on driving the initiative of financial inclusion through the onboarding of unbanked users with a target of about eight million active users.

The Governor disclosed that since the launch of the eNaira, the CBDC has garnered over 840,000 downloads in over 270,000 active wallets. And so far, about 200,000 transactions worth over $9.5 million have been recorded through the eNaira digital currency.

In the first phase, the eNaira offering was only available to bank account holders and through smartphone apps.

In the second phase, the Central Bank plans to extend the payment service to feature phones by using Unstructured Supplementary Service Data (USSD) codes which operate the same way as SMS. The regulator expects that such an effort will further boost financial inclusion for unbanked users who currently constitute about 40% of the national population.

The Nigerian authorities plan to allow eNaira users to create wallets for the CBDC by dialing a four-digit code on their mobile phones, whether or not they have bank accounts.

The aim is to onboard unbanked citizens of Nigeria onto the country’s existing financial system. The government targets to get over eight million people to adopt eNaira as a payment method in the next few months.

The Nigerian government also plans to enhance the eNaira Hackathon platform to connect people to the developers and coders of eNaira to ensure accessing quick solutions to any issues or glitches.

Emefiele commented: “We don’t have a choice but to live with the fact that we are now in a digital economy, in a digital space, where the user[s] of cash will dissipate almost to zero.”

Earlier in May, the Central Bank started allowing people to use the eNaira for day-to-day payments like paying utility bills and booking flight tickets.

The Race to Launch CBDCs

According to the 2022 PricewaterhouseCoopers’s Central Bank Digital Currency (CBDC) Global Index, the Central Bank of Nigeria’s eNaira and the Sand Dollar of the Bahamas are leading the retail project indexes of central banks worldwide.

In October last year, Nigeria launched eNaira, a central bank digital currency (CBDC), to complement the country’s physical currency.

In October 2020, the Central Bank of The Bahamas issued a CBDC known as “the Sand Dollar,” a digital iteration of the Bahamian Dollar, the national fiat currency.

According to PwC index report, over 80 percent of Central Banks globally are considering launching a CBDC, with many in the research phase while others in the pilot phase.

China became the first major economy to pilot a CBDC in 2020 with a digital currency (the digital yuan) being developed by the People’s Bank of China.

As of March, this year, the digital yuan’s pilot programs are running in 12 cities, including Beijing and Shanghai.

Image source: Shutterstock


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Nigerian Government Enhances eNAIRA to Draw Financial Inclusion

The Central Bank of Nigeria (CBN) has announced the upgrade to its Central Bank Digital Currency (CBDC) dubbed the eNAIRA.


Bariboloka Koyor, a Branch Controller of the apex bank confirmed the new move, noting that the new upgrade will make it possible for citizens to make bills payment with the eNaira.

“Starting from next week, there is going to be an upgrade on the eNaira speed wallet app that will allow you to do transactions such as paying for DSTV or electric bills or even paying for flight tickets. Also, the USSD code *997# is out and it is just for more people to be aware of it and begin to use it,” the CBN Executive said.

The upgrade announcement was followed by a sensitization campaign at key e-commerce centres in targeted areas of Lagos State. 

The eNaira was launched last year in a bid to stir the evolution of the payments landscape in the country. The move was part of the government’s response to combat the growing popularity of what it termed speculative digital currencies, including Bitcoin (BTC) and Ethereum (ETH) that has been taking a good share of the youth’s investment portfolio in recent years.

The Central Bank touted the eNaira as a faster payment alternative when compared to traditional payment methods, such as Internet Banking, Bariboloka urged citizens to embrace the CBDC to enjoy its free charges.

The CBN Executive also noted that the ultimate goal of the eNaira is to draw financial inclusion across the board, a model that other apex banks around the world have been building their CBDCs on.

“This is a project that the CBN has rolled out to reach out to every Nigerian in terms of financial inclusion and in terms of efficiency, reliability, and safety of banking transactions so that we can do banking transactions very easily and safely and the people in Nigeria can enjoy the benefit of the eNaira,” he added.

Image source: Shutterstock


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35% of Nigerians Have Entered the Crypto Market in the Last 6 Months, Study Shows

Nigerians are entering the crypto space because of the lack of affordable financial services and high inflation rates, given that 35% of them were engaged in this sector in the last six months, according to a study by crypto exchange KuCoin.

KuCoin suggested that cryptocurrencies were filling the gap in the traditional currency-based market because Nigerians are using them as an alternative for storing and transferring assets. Per the report:

“33.4 million Nigerians, which accounts for 35% of the population aged 18 to 60, currently own cryptocurrencies or have traded cryptocurrencies over the past 6 months.”

Peer-to-peer (P2P) is a favoured strategy among Nigerians, given that 65% of crypto investors in the nation made fiat deposits to cryptocurrencies through P2P platforms. Furthermore, 52% of Nigerian crypto investors have stashed half of their assets in cryptocurrencies. 

KuCoin pointed out:

“70% of Nigerian crypto investors intend to increase their cryptocurrency investments over the next 6 months, giving reasons to believe that digital asset adoption in the country is accelerating.”

The high inflation rates on Nigerian soil have made the national currency, Naira, depreciate by more than 209% in the last six years. 

As a result, cryptocurrencies have been acting as alternative sources of income, especially in the bullish market of 2021, where Bitcoin (BTC) hit an all-time high (ATH) of $69,000 in November. 

According to the study, women investors in Nigeria have not been left behind on the crypto bandwagon because they are at par with their men counterparts at 50%.

Nigeria has been crafting a name for itself in the crypto space, given that it became the first African nation to officially roll out a central bank digital currency (CBDC) in October last year.

Dubbed the “eNaira,” this digital currency aimed to advance the boundaries of the payments system so that financial transactions would become seamless and easier. 

This CBDC would also be the only digital currency that would be legal tender in Nigeria and would be accepted alongside physical cash and complemented by an official mobile wallet application.

Image source: Shutterstock


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From eNaira to eHryvnia, a Caribbean fintech develops CBDC around the world

Barbados, a paradise island in the West Indies, is known for its azure beaches, tidal waves, shipwrecks, homegrown grown Barbadian (Bajan) hospitality, and more recently, an influx of remote workers. Now, one can add cryptocurrency innovations to that list as well. Bitt, a Bajan fintech firm developing blockchain technology, has successfully created the eNaira central bank digital currency, or CBDC, for Nigeria and is on the path to creating an electronic Hryvnia for Ukraine.

In an exclusive interview with Cointelegraph, Brian Popelka, chief executive officer of Bitt, discussed the technology behind the eNaira and the roadmap for the firm going forward. 

CT: Would you please describe the technology behind the eNaira digital currency that you created?

Brian Popelka: It’s really a stablecoin minted by the Central Bank of Nigeria [CBN]. So it is, unlike any of the typical cryptocurrencies or even a stablecoin, this […] Is a digital version of the fiat currency within Nigeria. So this is government money. It can be transacted by a user who has downloaded a wallet through the various app stores and at participating merchants. So the ecosystem that we’ve worked with the CBN, the Central Bank of Nigeria, to deploy our technology allows the central bank to have mint and all the rights around minting.

Then, they distribute the digital version of that coin to participating financial institutions. Afterwards, those financial institutions can transact with merchants and consumers using the eNaira. So a little bit different than Bitcoin (BTC) in that it is a fiat currency. And, and while we certainly utilize smart contract technology […] We’re built on a hyper ledger transaction network. So it’s a closed-loop within the Nigerian government.

Related: Eastern Caribbean CBDC expands to another two territories

CT: And so why did the Nigerian government, out of all the fintech firms in the world, select you guys, a crypto firm that’s based in Barbados, to embark on this project?

BP: Yeah, so certainly born in Barbados, we have an office out of the U.S., and we are very proud of our Caribbean roots. Because really, the idea for digital currency was hatched in a […] Developing region where the ability to move funds around digitally can have a significant impact in the Caribbean. For example, 95% of all transactions are done physically through notes and coins, 95% of them. And so part of the mandate in the Caribbean similar to Nigeria was to […] Sort of do fewer transactions, using notes and coins, which of course, helps to eliminate some costs related to the printing and management of notes and coins.

But the Central Bank of Nigeria has been on this project for a long, long time. You know, for several years, they have done a lot of work to educate themselves on the process. But the reality is that we’ve been six years in the business, we have a mature product already built, we didn’t have to build it to suit Nigeria; we already have a product built. And we were already deployed in the Eastern Caribbean with the Eastern Caribbean central bank. We were one of several, and they cut it down to a dozen. And one of the key reasons that they landed on us was, of course, we’d already had it out; [We] had the deployment, and they had a very tight timeline for being able to deploy this. So we met about an eight-week timeline to be able to go live.

CT: Interesting. So what are some new features you guys plan to deploy?

BP: The Central Bank of Nigeria has a long laundry list of feature sets they’re interested in providing. And we’re just there to help facilitate as the service provider. I think what you’ll see is a lot of stuff you would typically see in electronic transactions. So obviously, there’s the point of sale. Also, wallets that will be made available for people who don’t have bank accounts. Financial inclusion is a key issue that we would like to help solve. Remittances, interbank transfers, and cross-border payments are ultimately part of the roadmap. Micro-lending or peer-to-peer lending, those types of financial instruments could always be added to the network in the future.

Related: Nigeria’s central bank partners with fintech firm Bitt Inc for CBDC rollout

CT: And are there any other cryptocurrency projects you guys are currently working on?

BP: We are working on one in Eastern Europe [the digital Hryvnia] that we’re pretty excited about. It’s a project that we’re working with the Stellar Foundation on. We are also in a private pilot with, there’s no public announcement, but we are working with the National Bank of Belize on a project, it’s not a CBDC, but it’s a stablecoin project. And just so yeah, there’s plenty of work, and then, you know, the entire market is picking up steam. And so, we’re seeing inquiries and RFPs coming from all corners of the world. So we’re very excited about, you know, the opportunities that are revealing themselves right in front of us.