The Central Bank of Nigeria may launch a digital currency pilot by the end of this year!

The Central Bank of Nigeria (CBN) said in Lagos on Thursday that it could launch a digital currency by the end of 2021, local media Today reported.

Rakiya Mohammed, an information technology expert at the CBN, revealed that Nigeria has been studying CBDC for two years and has made great progress. She said: "Before the end of the year, the central bank will issue a special announcement and may launch a pilot program to be able to provide this currency to the public."

Mohammed said the currency would complement physical banknotes when it is finally put into use.

According to her, another reason why the CBN plans to launch a digital currency is to make remittances from abroad to Nigeria easier.

Nigeria, which received more than $5 billion in remittances each quarter before the pandemic hit and caused a global drop in remittances, set up a temporary incentive program earlier this year to send international money to Nigeria.

The expert also said the CBN will explore various technological options and work with various industry players and move to the next phase of proof of concept to pilot the initiative.

Mohammed said the CBN considered the architecture, accessibility issues and privacy of the digital currency.

Godwin Emefiele, governor of the Central Bank of Nigeria (CBN), said digital currencies are “coming alive even in Nigeria.” Many Nigerians have already embraced cryptocurrencies.

Nigerian authorities have been debating how to regulate the use of private cryptocurrencies in the country. Earlier this year, the CBN ordered all local banks to seek and close accounts associated with crypto platforms, with the bank’s governor later clarifying that crypto trading was not banned in the country.

Meanwhile, cryptocurrency usage as a store of value and remittance tool is surging in Nigeria, with Ray Youssef, CEO of peer-to-peer lending platform Paxful, saying last week that the country is its largest market.