CBDC launch will empower Nigeria with early adopter advantage
The launch of a Central Bank Digital Currency (CBDC) will give Nigeria early adopter advantage, according to Suyash Sumaroo, the co-founder of Horizon Africa Blockchain.
Likening the proposed pilot of e-naira later this month to early cryptocurrency adopters, Sumaroo believes Nigeria’s early move could provide it with a definitive advantage over other countries.
“It is no secret that Bitcoin and other altcoins are going to become increasingly popular and important in the way people and businesses operate,” he said. “As a result, making any kind of in-roads in any form in the crypto space can be a good initiative.”
There is a fine line separating cryptocurrencies and CBDCs. The former, which is reportedly on the increase in recent years is self-regulated while the latter is a digital version of existing national currencies controlled by respective governments.
A recent Luno exchange survey suggests that in terms of knowledge gap regarding cryptocurrencies, 55% of respondents in Nigeria are sceptical about investing in cryptocurrencies and cited a lack of understanding. The stats for Kenya and South Africa were 64% and 56% respectively..
The online global survey also found that only 3% of cryptocurrency investors in the three African countries do not have a plan when making investment decisions.
At the same time, plans to issue CBDCs are growing too, going by the Bank for International Settlement’s 2021 Annual Report which says about 85% of central banks globally are already considering it.
Sumaroo maintains that Nigeria’s e-naira plan shows that African countries are not willing to stop their own initiatives. “The e-naira project is part of a growing international trend where countries are seemingly adopting blockchain technology in their monetary system,” he said, adding that the best time for Nigeria or any other country to have a CBDC was years ago as it is now a must-have nowadays for any country that wants to have a strong foothold and control in cryptocurrencies.
He adds, “However, relatively speaking, Nigeria could be considered as among the first countries to actually have a concrete CBDC project which people and businesses could actually use. The current rise in popularity of open blockchains like Bitcoin and Ethereum is currently providing a fertile ground for people to actually start using such systems.”