Nigeria has become the first African country to launch a digital currency - the eNaira - a move its leaders said will expand access to banking, enable more remittances and even grow the economy by billions of dollars. Authorities say with the e-Naira, they can better monitor transactions, curb black-market trading for the paper currency, protect against devaluation, and lower inflation. 

Nigeria is first African country to launch digital currency

The government expects the e-Naira to improve store of value for Nigeria weakening currently as well as drive financial inclusion for millions of citizens. President Muhammadu Buhari said that the digital currency and the blockchain technology it uses can foster economic growth and increase the GDP of Africa's biggest economy by U.S.$29 billion over the next 10 years.

However, critics fear that Nigeria's central bank digital currency will allow central banks to accrue greater control, serving as a tool for regulators to monitor private citizens' financial footprints. In June 2020, the CBN had announced that its digital currency will be launched by the end of 2021. The announcement came months after it banned financial institutions from cryptocurrency-related transactions in the country, claiming the digital currency is used for money laundering and terrorism.