Nigeria’s Central Bank to Study Launch of Official Stablecoin After eNaira Struggles

Key TakeawaysCentral Bank of Nigeria (CBN) to form a working group with the Ministry of Finance and other regulators to assess the framework and potential impact of a national stablecoin.The move follows low adoption of the CBN’s existing digital currency, the eNaira, launched in 2021.According to the IMF, only 0.5% of Nigerians used eNaira one year after launch, with 98.5% of wallets inactive.Nigeria Explores Stablecoin Amid Low eNaira AdoptionAccording to TechFlow, Olayemi Cardoso, Governor of the Central Bank of Nigeria, announced after the World Bank and IMF Annual Meetings in Washington that the CBN will collaborate with the Ministry of Finance and financial regulators to create a special working group.This group will evaluate the framework, risks, and economic implications of introducing an official Nigerian stablecoin, designed to complement the existing eNaira and enhance the country’s digital payment ecosystem.Lessons From eNaira’s Slow UptakeDespite being Africa’s first central bank digital currency (CBDC), the eNaira has struggled to gain traction.IMF data from 2023 revealed that only 0.5% of Nigerians had adopted the eNaira a year after launch, with 98.5% of issued wallets remaining inactive.Although wallet numbers rose to 13 million by early 2024, user engagement remains low. Analysts suggest that a stablecoin pegged to the naira, with improved usability and interoperability, could drive higher adoption rates among businesses and individuals.