- Nigeria is all set to accept the presence of private stablecoins.
- The requirement to make a legal structure for stablecoins is written in the recent central bank strategy paper.
The Central Bank of Nigeria issued an 83-page report whose headline was “Nigeria Payments System Vision 2025.” Under this report, CBN acknowledges the advancement of a regulatory structure for the potential usage of stablecoins. The document highlights the requirement to make a structure, given that stablecoins are possibly to be a victorious payment method within the nation.
The report also mentions the things about the regulation of initial coin offerings (ICOs). It notes the present lack of regulation in the region, which has resulted in investor losses. Although, the CBN witnesses the potential for accepting ICOs as a fresh offer to fundraising for capital projects, peer-to-peer lending, and crowdfunding. Thus, a regulatory structure is also required “in the process of adoption of an ICO-based investment solution.”
Although, the stablecoins and ICOs part mentioned in the report is quite less than that compared to the noted part about eNaira, Nigeria’s CBDC. The Central Bank acknowledges it as a capability “enabler for change” in the national economy. It considers gaining a terminal execution of the currency in 3 to 5 years.
In December last year, Nigeria decreased the number of cash persons and individuals can take out to almost $225 and $1,125 per week, respectively, just a try to force its “cash-less Nigeria” law and enlarge the use of the eNaira.
The acceptance rate of eNaira has been low from the very date it was introduced in late 2021, with not more than 0.5% of the total population of the country using it, as reported on October 25, 2022. The government has been working hard to induce natives of Nigeria to adopt the CBDC in spite of the fact that the country has been recognized by Chainalysis as the very first country in Africa for crypto adoption and has placed 11th over the world.
The regulatory structure for stablecoins will go a long way in making Nigeria a Bitcoin retreat. It will also come at a time when the country is functioning in the way of legalizing digital assets. As reported by a media channel in December, draft legislation in parliament will make the Securities and Exchange Commission the regulator for digital assets, which it refers to as “capital for investment.”
Source: https://www.thecoinrepublic.com/2023/01/20/nigeria-to-introduce-icos-and-stablecoins-to-widen-payment-outlook/