The Nigerian central bank digital currency (CBDC) is not receiving the warm reception expected from its crypto-savvy population.
According to a Bloomberg report, less than 0.5% of Nigeria’s 217 million people are using the government-issued digital currency, eNaira, a year after its launch.
This comes despite Chainalysis identifying Nigeria as the top country in Africa for cryptocurrency adoption and ranked 11th globally, while a KuCoin report found that 35% of the Nigerian population aged 18-60 had owned or traded cryptocurrencies this year.
Bloomberg noted that Nigerians were confused due to a lack of clarity from the state that cracked down on crypto last year.
In February 2021, the Central Bank of Nigeria banned banks from servicing crypto exchanges in an effort to cut fiat on- and off-ramps.
Educating people who generally mistrust the state and the ruling elite has also become a challenge for the central bank, according to the report.
The #Nigerian eNaira is a central bank digital currency (CBDC) that was launched 1 year ago, yet only 0.5% of Nigerians use it.
According to TripleA, more than 10% of the population owns #Crypto.
Nigerians want Crypto, but they don’t want Government-backed Crypto. pic.twitter.com/WaM8nmHxRg
—Crypto Rand (@crypto_rand) October 25, 2022
Furthermore, the naira has been devalued some six times since 2015, and economists expect a further 20% loss in value next year as the economy has been further aggravated by runaway inflation, which could cause the momentum of a CBDC a hard sell for many. of the country’s citizens.
According to Lagos-based frontier and emerging markets investment bank Renaissance Capital director Adesoji Solanke, “eNaira doesn’t address any of these basic use cases, so its low adoption rates so far are not surprising.” .
The disappointing numbers are now prompting Nigeria’s central bank to step up efforts to increase its adoption, including offering a 5% discount to drivers and passengers of the motorized rickshaws that ply the city’s streets, according to the report.
Related: Nigeria Becomes Most Crypto-Obsessed Nation After April Crash
In August, the Governor of the Central Bank of Nigeria, Godwin Emefiele, announced that the eNaira project entered its second phase in August with a adoption goal of eight million users.
At the time, he added that the CBDC has had some 840,000 downloads, with some 270,000 active wallets. By August, around 200,000 transactions worth 4 billion naira had taken place, roughly $9.5 million at the time.
According to the Atlantic Council’s CBDC tracker, Nigeria is one of eleven countries to have fully implemented a central bank digital currency, the other ten being in the Caribbean.