In a groundbreaking move set to transform Nigeria’s financial landscape, the Africa Stablecoin Consortium (ASC) has announced the imminent launch of the compliant Nigeria Naira (cNGN) stablecoin on February 27, 2024. This initiative brings together a coalition of Nigerian financial institutions, fintechs, and blockchain experts poised to revolutionize the country’s economic interactions.

The ASC made the pivotal announcement in a statement released last Friday, highlighting the cNGN’s launch as riding on the recent release of the Regulatory Sandbox by the Central Bank of Nigeria (CBN). This milestone marks a significant stride towards leveraging blockchain technology for enhanced financial transactions while ensuring compliance with regulatory frameworks.

The consortium expressed its vision for the cNGN, emphasizing its role in redefining financial interactions securely and seamlessly. They noted that the stablecoin is backed 1:1 by Naira reserves held in designated commercial banks, essentially transforming the Nigerian Naira into a dynamic instrument for global transactions.

“This (the cNGN) ushers in a new era of financial fluidity, bridging the Nigerian Naira with the global market through blockchain technology,” the ASC stated. They highlighted its potential to expedite settlements globally at minimal costs, mirroring the speed of text messages and offering unparalleled efficiency in both domestic and international financial transactions.

“More than just a currency, cNGN shortens settlement times, enabling payments that traverse the globe swiftly, mirroring the speed of a text message and at a fraction of the cost,” it said.

The consortium underlined the diverse utility of the cNGN, emphasizing its capacity to extend financial reach beyond Nigeria’s borders. Users will experience a seamless, cost-effective means to engage with the global marketplace while using their familiar Naira.

According to the ASC, the cNGN’s functionalities encompass various use cases, including swift remittances, enabling instantaneous fund transfers, facilitating international trade with reduced fees, and empowering freelancers to receive payments globally in minutes.

“This breakthrough paves the way for instantaneous financial transactions, seamlessly connecting Nigeria’s vibrant economy with international markets and offering unprecedented efficiency in both domestic and global financial interactions,” the consortium further noted.

This initiative echoes recent collaboration efforts among Nigerian banks and fintech firms to develop and manage the cNGN. It will be interoperable with multiple public blockchains, facilitating straightforward international transfers and widening its global applicability, akin to established stablecoins like USDT and USDC.

“Sending money home feels like sending a text message, effortless and instant: No more agonizing days waiting for remittances to clear. With cNGN, supporting your loved ones back home becomes as simple as a quick tap on your phone. No more standing in lines,” the consortium noted.

“With cNGN, funds land directly in their wallets within seconds, ready to fuel their dreams and brighten their days. No more distance, no more delays, just the magic of compliant virtual assets bridging the gap between hearts.

“Get paid, anywhere, instantly. Ditch the limitations of location and outdated payment systems. With cNGN, you can freelance for the world, right from your desk in Nigeria. Your talent knows no borders, so why should your income? Skip the bank queues and paperwork. Receive payments from clients across the globe, directly deposited into your cNGN wallet in minutes.”

As a distinguishing feature from the eNaira, which is solely developed by the apex bank, the cNGN is a consortium-driven stablecoin, compliant, and regulated. It will be pegged to the Naira in the Reserve Bank account, ensuring stability and oversight by the collective expertise of the consortium.

The ASC’s announcement marks a significant stride towards leveraging blockchain technology to enhance financial inclusion, reduce transactional barriers, and amplify Nigeria’s integration into the evolving global financial industry.

This initiative holds the promise of transforming not only the Nigerian economy but also setting a precedent for blockchain-based financial innovations across the African continent, redefining the future of financial transactions in the region.

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Nigeria is a special place. When the news broke that Economic and Financial Crimes Commission (EFCC) operatives raided the headquarters of Dangote Group, as part of investigations into possible misuse of foreign currency, I had expected that during the next trading day on the Nigerian stock exchange, the values of Dangote Cement and other companies in the Group would struggle.

But you know what? Investors did not care. It was similar to what happened when APC named Aliko Dangote as part of Buhari’s reelection committee member in 2019. On that one, investors did not pay attention also.

If this information does not move markets in Nigeria, what are investors trading on then? In the United States, Dangote properties would have suffered huge losses. But in Nigeria, just like in elections, no one cares about anything. 

“We went to the head office of Dangote Group today to look into their books on the ongoing investigation on the abuse of the extant laws that govern the foreign exchange transaction during the tenure of Godwin Emefiele as CBN governor,” one of the sources told Reuters.

“Here, we are talking about multiple exchange rates and others. It is an ongoing investigation and it was the turn of Dangote Group today,”  

Sure, they do not re-price in near-real time, but over weeks and months, they do re-price. That simply shows the level of our stock market development. It is not driven by data and most times, it is all about herding and speculations. Once in, they tune off, and even a possible criminal investigation in a company does not constitute risk! What a nation!

Count yourself lucky of being a Nigerian because you can get away with most things!