The Central Bank of Nigeria (CBN) says it will launch the pilot scheme of its digital currency by October 1, 2021.
Earlier this year, CBN banned cryptocurrency transactions in the country, warning that it poses the risk of loss of investments, money laundering, terrorism financing, illicit fund flows, and other criminal activities.
However, at the end of a private webinar on Thursday, CBN director of information technology, Rakiya Mohammed, said about 80 percent of central banks globally are currently exploring the possibility of issuing their central bank digital currency (CBDC) and Nigeria could not be left behind.
Mohammed said CBN may conduct a proof of concept before the end of this year.
According to her, the project name is tagged ‘GIANT’ and it will use the Hyperledger Fabric blockchain.
The Hyperledger Fabric is an open-source project that acts as a foundation for developing blockchain-based products, solutions, and applications using plug-and-play components that are aimed for use within private enterprises.
CBN said the importance of its digital currency will include macro-management and growth, cross-border trade facilitation, financial inclusion, monetary policy effectiveness, improved payment efficiency, revenue tax collection, remittance improvement, and targeted social intervention.
If the pilot scheme is eventually launched, Nigeria will join others like South Africa (digital Rand), Tunisia (eDinar), Ghana (e-cedi), Sweden, Japan, South Korea, and Russia.