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The Central Bank of Nigeria is working with Gluwa to strengthen eNaira.

Nigeria’s central bank is working to adapt to a rapidly changing regulatory and technological environment by nurturing the development of its own digital currency.

Date: 2024-03-08 Author: Marek Stiller
The Central Bank of Nigeria is working with Gluwa to strengthen eNaira.

To accelerate the use of the country’s central bank digital currency (CBDC), eNaira, Nigeria’s central bank has partnered with blockchain-based financial platform Gluwa Nigeria.

The partnership, announced by Gluwa on March 7, underscores the Central Bank of Nigeria ‘s ongoing efforts to address the challenges of financial inclusion and CBDC adoption.

The Central Bank of Nigeria is working to popularize eNair.

By integrating with eNaira, Gluwa intends to make credit profiles available to those without a bank account. This will create a system in which credit scores and ratings will be assigned digitally, enabling more Nigerians to access credit in a CBDC-compliant manner. In addition, local fintech lenders will be able to use Gluwa’s services to facilitate billing, credit management and assessment.

In addition to lending, Credal’s Gluwa solution will cover settlement, credit management and appraisal for local fintech lenders.

The Central Bank of Nigeria has been working to increase the use of eNaira since its launch in October 2021. Data from the International Monetary Fund shows that only about 1% of Nigerians with bank accounts have opened eNaira wallets, and more than 98.5% of them are not being used.

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Blockchain-based solutions such as Gluwa are trying to change the problem of credit systems, which has long been an obstacle for Africa.

These solutions use tokenization to bridge the data gap that exists in traditional credit scoring, drawing on peer-to-peer transactions. Gluwa’s presence in Nigeria dates back to 2022, when it partnered with Lagos State to tokenize agricultural assets using real world asset (RWA) technology.

Cryptocurrency regulations in Nigeria

Despite the introduction of eNair in 2021, the Nigerian government has a complex relationship with cryptocurrency. At first, commercial banks that partnered with the cryptocurrency sector were banned, but inconsistent regulations remain a problem.

Recently, the Nigerian Communications Commission (NCC) blocked access to the platforms of several cryptocurrency companies, including Binance, due to suspected Naira manipulation in the P2P market. According to Chainalytic , Nigeria ranked number one in P2P transactions in 2023.

The situation worsened when government agencies detained two senior Binance executives and fined them $10 billion. However, a senior government official later denied the claims.

Gluwa’s founder and CEO, Tae Oh, said his solution aims to increase eNair adoption and be an innovation leader in blockchain-based financial services in Nigeria and around the world.

Tae underscores his commitment to improving financial solutions by spearheading Creditcoin Network, a tier-1 blockchain similar to Gluwa.

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Marek Stiller
Marek Stiller
Founder of the "Cryptocurrency for Beginners" channel on YouTube. He collaborates with Łukasz to form the Arena Trading group, while at the same time being passionate about blockchain technology. His knowledge and experience in the cryptocurrency industry help beginner investors better understand this dynamic market.
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