- cNGN token is linked to and supported by the Nigerian naira, the official currency.
- This new stablecoin is built on public blockchains as per sources.
Investors and the Nigerian economy stand to benefit from the new stablecoin, the cNGN, which is being developed and managed by a consortium of Nigerian institutions. Anonymous insiders within the project have confirmed that the cNGN token is linked to and supported by the Nigerian naira, the official currency of the nation.
Interoperability with many public blockchains allows for easy worldwide transfers and expands its usage globally, similar to popular stablecoins. Access Bank, Sterling Bank, Providus, First Bank, Korapay, Interstellar, Interswitch, Budpay, and Convexity are all partners in the cNGN effort.
Strategic Development
This new stablecoin, in contrast to the eNaira digital currency issued by the central bank, is built on public blockchains such as Tron, Bantu, Polygon, Ethereum, and BNB Smart Chain. Top blockchain and fintech firms are its primary drivers, with major banks serving as its licensed custodians.
To supplement the eNaira, rather than replace it, is the role of the cNGN. The cNGN is managed by a consortium of Nigerian banks, in contrast to the eNaira, which was built by the CBN with more extensive capabilities.
Despite the lengthy procedure needed to provide digital services by the Nigerian Securities and Exchange Commission (SEC), the CBN reportedly permitted Nigerian banks mainly because it wants the financial sector to promote and enable blockchain technology.
Moreover, the Central Bank of Nigeria (CBN) lifted restrictions on Nigerian banks that were assisting cryptocurrency transactions. This comes almost two years after the CBN outright banned banks from dealing with digital currencies.
Also, in a circular sent to banks on December 22, the CBN admitted that the strict limitations imposed on financial institutions in 2021 are unsustainable due to the increasing demand and use of cryptocurrency throughout the globe.
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