ENaira – A New Dimension To Payments In Nigeria

The Central Bank of Nigeria (“CBN”) on 25th October, 2021 launched the eNaira, the first Central Bank Digital Currency (“CBDC”) on the African continent. This, unsurprisingly, has generated a lot of interest from many observers with some comparing cryptocurrencies to CBDC while others simply seek a better understanding of the concept of a CBDC. This article discusses Nigeria's version of the concept of a CBDC in comparison with other countries who have CBDC's and the applicable regulatory framework of the eNaira

A CBDC is the digital equivalent of a fiat currency of a Country backed by its Central Bank. In other words, a CBDC enjoys the full weight and credit of the issuing sovereign government. It is therefore important to draw the fundamental distinction between CBDCs and Cryptocurrencies as while they are both digital assets, cryptocurrencies do not enjoy the full weight and credit of any government. Secondly, while CBDCs like fiat currency