cNGN, Nigeria’s first compliant stablecoin, has been launched by a coalition of software firms and now participates in the Nigerian Securities and Exchange Commission’s incubation program. Live on licensed exchanges and operating on major blockchain protocols, it aims to improve the country’s capital market and offer stable digital currency options to users, facilitating faster cross-border payments. The rollout is set for February.
A coalition of software companies has introduced Nigeria’s first compliant stablecoin, known as cNGN. This stablecoin is now part of the incubation program by the Nigerian Securities and Exchange Commission and is currently operating on two licensed digital asset exchanges in the country. According to Adedeji Owonibi, the project director, developing cNGN took three years, and it functions on multiple major blockchain protocols, including Ethereum and BNB. The initiative aims to enhance financial operations and capital markets in the digital era.
The cNGN stablecoin was created by a collaboration between Alphageek, Convexity, Interstellar, and the Digital Currency Coalition. This partnership seeks to provide regulatory compliance and stability within Nigeria’s digital economy. The Nigerian securities regulator’s approval comes shortly after the director general’s commitment to expedite the licensing process for digital asset firms.
Critics argue that because cNGN is pegged to Nigeria’s declining naira, it may have difficulties in gaining popularity. Many users in Nigeria reportedly favor Tether (USDT), which is backed by the more stable U.S. dollar. However, supporters believe that cNGN could facilitate faster cross-border payments, providing a valuable service in the digital asset space.
Senator Ihenyen, a lead partner at Infusion Lawyers, stated that cNGN could revolutionize payment processes by allowing for economical, quick, and secure transactions. He highlighted that the stablecoin presents new opportunities for users, bridging traditional fiat currency and the cryptocurrency landscape, and is positioned to foster seamless interactions between both worlds.
The stablecoin’s team has announced its plan to roll out cNGN across partner exchanges and financial institutions beginning in February, promoting its use in the digital economy.
The introduction of cNGN marks a significant step towards regulatory compliance in Nigeria’s rapidly evolving digital asset landscape. Stablecoins, which are cryptocurrencies pegged to stable assets like fiat currencies, provide opportunities for volatility mitigation in digital transactions. The Nigerian Securities and Exchange Commission’s involvement indicates an increasing recognition of cryptocurrencies in formal financial frameworks, which also aims to enhance capital market operations. With the cNGN initiative, the collaboration between technology firms seeks not only to stabilize but also to innovate within Nigeria’s economic context.
The launch of cNGN is a pivotal development for Nigeria’s digital economy, aiming to meet regulatory standards while providing a stable digital asset option that harnesses local currency. Despite some skepticism related to its backing by a depreciating naira, the potential of cNGN to facilitate cross-border payments and expand financial accessibility could make it a significant player in Africa’s digital asset market. The upcoming rollout signifies an ongoing effort to enrich the digital financial ecosystem in Nigeria.
Original Source: news.bitcoin.com
