cNGN, Naira Stablecoin, Set to Launch on February 27, 2024

The Central Bank of Nigeria (CBN) has granted approval for the launch of the country’s first-ever naira stablecoin, the Compliant Nigerian Naira Stablecoin (cNGN). This highly anticipated digital currency is poised to transform the financial landscape for Nigerians at home and abroad, with its official launch set for February 27, 2024.

Developed by the Africa Stablecoin Consortium (ASC), a collaborative effort of leading Nigerian financial institutions, fintech innovators, and blockchain experts, cNGN promises to usher in a new era of financial inclusion and accessibility.

Additionally, the ASC broadcasted the cNGN launch date, on Thursday, January 4, 2024 and also revealed that it’s been authorized by the Nigerian apex bank to to pilot the stablecoin in its innovative regulatory sandbox.

What is a stablecoin?

Stablecoins are cryptocurrencies designed to maintain a stable value pegged to a traditional currency or asset. In the case of cNGN, each unit will be backed by one Nigerian Naira (that is, it’s pegged 1:1 with naira), held in reserve by designated commercial banks.

This ensures that cNGN will fluctuate minimally compared to the Naira, offering users a reliable and predictable store of value.

What are the potential benefits of cNGN?

According to ASC some benefits of the cNGN including shortening settlement time and “enabling payments that traverse the globe swiftly,” making it easy, cheaper and seamless for worldwide remittances.

Additionally, the launch of cNGN is expected to bring a multitude of benefits to Nigerians, including:

• Enhanced financial inclusion: cNGN can reach unbanked and underbanked populations, providing them with access to financial services through their mobile phones.
• Faster and cheaper cross-border transactions: Sending and receiving money internationally will become significantly faster and more affordable with cNGN, eliminating the need for expensive intermediaries.
• Increased remittance inflows: Nigerians living abroad can easily send money back home using cNGN without the need for currency conversions, potentially boosting the country’s foreign exchange reserves.
• Growth of the digital economy: cNGN can fuel the growth of Nigeria’s digital economy by facilitating online payments and e-commerce.

However, it’s important to note that the CBN has taken a cautious approach to cNGN’s launch by piloting it within a regulatory sandbox.

This controlled environment allows regulators to monitor the stablecoin’s performance and address any potential risks before a wider rollout. This could mean that the Nigerian stablecoin will not be offer for public advantage immediately after debut.

The successful launch of cNGN has the potential to be a game-changer for Nigeria’s financial landscape. It could pave the way for further innovation in the digital currency space and position Nigeria as a leader in blockchain technology adoption.

With just over two months until its debut, cNGN is undoubtedly one of the most exciting developments to watch in the Nigerian fintech scene. Stay tuned for further updates on the cNGN launch in the coming weeks in our Channels.