Nigerian banks create new stablecoin — cNGN

Nigerian banks are collaborating to create and oversee the new stablecoin cNGN, which is a new digital currency designed to benefit both token holders and the Nigerian economy.

According to sources within the project, who prefer to remain anonymous, the cNGN token is backed by and pegged to the Nigerian naira, the country's fiat currency.

Like popular stablecoins, cNGN provides compatibility with various public blockchains, facilitating global transfers and expanding their use internationally.

Partners of the cNGN initiative include Access Bank, Sterling Bank, Providus, Korapay, First Bank, Interstellar, Interswitch, Budpay and Convexity.

“cNGN is a compliant and regulated consortium-backed stablecoin that we advocate. It maintains a naira link in the reserve bank account.”

Unlike the central bank digital currency eNaira, the new stablecoin is developed on public blockchains (Bantu, Polygon, Ethereum, BNB Smart Chain and Tron). It is driven by leading blockchain and fintech companies, with major banks serving as licensed custodians.

CNGN serves as a complement, not a replacement, for eNaira. Unlike eNaira, which was created with greater capabilities by the Central Bank of Nigeria (CBN), cNGN is controlled by a consortium of Nigerian banks.

According to sources, the CBN gave the green light to Nigerian banks primarily because it wants the financial system to support and facilitate blockchain technology despite the cumbersome process required by the Nigerian Securities and Exchange Commission to provide digital services.