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All set for unveiling of new digital currency, e-Naira today

Central Bank of Nigeria (CBN) said recently that President Muhammadu Buhari will unveil the e-Naira on Monday.

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According to the regulator, the launch of the eNaira is a culmination of several years of research work by the Central Bank of Nigeria in advancing the boundaries of the payments system in order to make financial transactions easier and seamless for every strata of the society.

Mr. President will formally unveil the Nigerian Central Bank Digital Currency (CBDC), known as the eNaira today being Monday 25 October 2021, at the State House, Abuja.

CBDCs are regulated digital currencies issued by the central bank of a country. A CBDC can be a supplement or a replacement to traditional fiat currency. Unlike fiat currency, which exists in both physical and digital form, a CBDC exists purely in digital form. England, Sweden, and Uruguay are a few of the nations that are considering plans to launch a digital version of their native fiat currencies.

The  eNaira, IT NEWS NIGERIA learned, marks a major step forward in the evolution of money; and the CBN is committed to ensuring that the eNaira, like the physical Naira, is accessible by everyone.

There have been series of engagements with relevant stakeholders including the banking community, fintech operators, merchants, and indeed, a cross-section of Nigerians.

“Given that the eNaira is a journey, the unveiling marks the first step in that journey; which will continue with a series of further modifications, capabilities, and enhancements to the platforms.

“The CBN will continue to work with relevant partners to ensure a seamless process that will benefit every user; particularly those in the rural areas and the unbanked population.

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“Since the eNaira is a new product, and amongst the first CBDCs in the world; we have put a structure to promptly address any issue that might arise; from the pilot implementation of the eNaira.

Digital Currency: What you need to know

Digital currency types

Digital currency is used to describe different types of currencies that exist in the electronic format and there are identifiable 3 types:

Central bank digital currencies (CBDCs) are regulated digital currencies issued by the central bank of a country. A CBDC can be a supplement or a replacement to traditional fiat currency. Unlike fiat currency, which exists in both physical and digital form, a CBDC exists purely in digital form. England, Sweden, and Uruguay are a few of the nations that are considering plans to launch a digital version of their native fiat currencies.

Cryptocurrencies: These are digital money that use cryptography to secure and verify transactions in a network. Bitcoin, Dogecoin and Ethereum are in this category because Cryptography is also used to manage and control their creation and rarely regulated

Virtual Currencies: Virtual currencies are unregulated digital currencies controlled by developers or a founding organization consisting of various stakeholders involved in the process. Virtual currencies can also be algorithmically controlled by a defined network protocol. An example of a virtual currency is a gaming network token whose economics is defined and controlled by developers.

Digital money or Digital currencies are currencies that are only accessible with computers or mobile phones because they only exist in electronic form. Typical digital currencies do not require intermediaries and are often the cheapest method for trading currencies. All cryptocurrencies are digital currencies, but not all digital currencies are cryptocurrencies. Some of the advantages of digital currencies are that they enable seamless transfer of value and can make transaction costs cheaper. Some of the disadvantages of digital currencies are that they can volatile to trade and are susceptible to hacks.

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