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eNaira: What You Need to Know About Nigeria’s CBDC

Nigeria’s Central Bank is set to launch its digital currency – eNaira. The country’s apex bank made the website live and got over a million hits within 24 hours of its release

Earlier this year, the Central Bank announced its decision to begin the process to launch its digital currency, which will run on the Hyperledger Fabric blockchain. Despite concerns about the privacy and safety of its users, eNaira was expected to launch on the 1st of October officially, 2021, to commemorate Nigeria’s 61st year of independence. 

A welcome message on eNaira’s website reads: “eNaira is a Central Bank of Nigeria-issued digital currency that provides a unique form of money denominated in Naira. eNaira serves as both a medium of exchange and a store of value, offering better payment prospects in retail transactions when compared to cash payments. eNaira has an exclusive operational structure that is both remarkable and nothing like other forms of central bank money. There are several benefits from a central bank-issued digital currency in Nigeria, and this cuts across different sectors of, and concerns of the economy.”

Here are some of the things to know about eNaira:

  • eNaira is the digital form of the Naira and will be used just like cash.
  • The eNaira wallet is a digital storage that holds the eNaira.
  • It is exchanged peer to peer.
  • The system uses a two-factor authentication system and encryption to ensure the safety of customers’ wallets and its holding.
  • It is held and managed on a distributed ledger.
  • Customers can make payments by scanning QR codes.
  • It is universal – anybody can hold it.
  • It does not yield any interest.

Challenges of Designing a Central Bank Digital Currency

There have been different speculations about Nigeria’s CBDC efficacy. What is yet to know is the safety and privacy of the currency. However, indeed, the introduction of eNaira will likely not reduce the replacement of stable coins in Nigeria’s crypto space. 

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