Nigeria will soon create its digital currency, the Central Bank of Nigeria said Tuesday as the bank continues to face questions over its ban on cryptocurrency transactions in the country.
The governor of the Central Bank of Nigeria (CBN), Godwin Emefiele, said this while addressing journalists after a two-day meeting of the Monetary Policy Committee in Abuja.
He said the idea of a digital currency would soon become a reality in the country, and that the central bank has already set up its committee, which is working on the concept.
The CBN governor also explained the need for collaboration with Nigerians abroad, through the issuance of diaspora bonds targeted at sundry infrastructure projects.
Even though Nigeria’s public debt stock was currently high, he said the MPC opined that project-specific diaspora bond issues could conveniently pay itself back without imposing a burden on government fiscal position.
This, he said, will boost foreign exchange supply and ease exchange rate pressure.
Responding to questions about cryptocurrency, the CBN governor reiterated that it has no place in the Nigerian financial system.
When asked whether the CBN had been vindicated following the crash of cryptocurrency in recent weeks, Mr Emefiele said the CBN investigated and found out that a substantial percentage of Nigerians are involved in cryptocurrency.
“Don’t get me wrong, some may be legitimate but I dare say most are illegitimate and I will corroborate that,” he said.
“Under cryptocurrency and bitcoin, Nigeria comes second right? But in the global size of the economy, Nigeria comes 27th.
“So do you think that there is some correlation? You think those countries whose economies are second and 26th will allow you to grow your cryptocurrency business to second position, if what is inside is a big deal that is going to profit everybody?” he asked.
Mr Emefiele spoke about the volatility of the cryptocurrency market, citing how Tesla boss, Elon Musk, tweeted that he was going to invest about $1.5 billion in crypto and the rates went to the highest roof.
“And he then tweeted again and raised a fee concerns and the thing plunged,” the CBN governor said.
“Elon Musk had himself decided that he will no longer deal in cryptos. And so if a man who felt it was good suddenly decides to say it’s no longer good and then you…don’t forget, those who invented crypto said it is encrypted.
“When they say it’s encrypted, it means that whatever is happening between me and you is only know to the two of us. And you know what? In case I defraud you because it is encrypted, you can’t even disclose my name and you can’t even get your money back.”