IMF Urges Nigerians to Trust the eNaira and Other Central Bank Digital Currencies because Crypto is No Match

IMF Urges Nigerians to Trust the eNaira and Other Central Bank Digital Currencies because Crypto is No Match

  • International Monetary Fund (IMF) has promised Nigerians that eNaira is more reliable than any other cryptocurrency
  • IMF argues that unlike eNaira and another central bank digital currency, there is no value attached to bitcoin, altcoin among others
  • The Central Bank of Nigeria launched its digital currency called eNaira on Monday 25, October 2021

The managing director of the International Monetary Fund (IMF), Kristalina Georgieva, says that crypto assets and stable coins are no match for well-designed central bank digital currencies (CBDCs) as eNaira.

Georgieva disclosed this while speaking at the Atlantic Council in Washington D.C. regarding the future of money, cryptocurrency, and Central Bank Digital Currencies (CBDCs).

According to her, the central banks of countries are exploring CBDCs and that it would soon displace cryptocurrency and become a mainstay.

IMF: Crypto Is No Match for Well-Designed eNaira, other Central Bank Digital Currencies
IMF Managing Director Kristalina Georgieva speaks at the Atlantic Council in Washington D.C. regarding the future of money, cryptocurrency, and central bank digital currencies (CBDCs).
Source: Getty Images

She said:

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"If CBDCs are constructed wisely, they have the potential to provide better resilience, safety, availability, and cheaper prices than private forms of digital money."

It is worth noting that central banks have advanced beyond theoretical conversations about digital currencies and are now in the experimental phase.

She noted:

“CBDCs are still in their early stages, and we don't know how far or quickly they will progress. CBDCs, if well built, have the potential to provide higher resilience, safety, availability, and cheaper costs than private forms of digital money.
"When contrasted to unbacked crypto assets, which are fundamentally volatile, that is certainly the case. Even the most managed and regulated stablecoins may fall short of a stable and welldesigned central bank digital currency."

The IMF boss also revealed that around 100 countries are exploring Central Bank Digital Currencies, Nairametrics reports.

She mentioned the Sand Dollar in the Bahamas, a proof-of-concept by Sweden’s Riksbank, e-CNY in China and Nigeria's eNaira.

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Georgieva revealed:

"The IMF is deeply involved in this issue, including through providing technical assistance to many members. An important role for the Fund is to promote exchange of experience and support the interoperability of CBDCs."

Three reasons why eNaira is better than Bitcoin others

She shared some of the lessons learned from various central banks from their digital currency efforts.

Firstly, she said:

“There is no universal case for CBDCs because each economy is different … So, central banks should tailor plans to their specific circumstances and needs.”

Secondly, she stressed that financial stability and privacy considerations are paramount to the design of CBDCs.

The IMF chief noted:

“In many countries, privacy concerns are a potential deal-breaker when it comes to CBDC legislation and adoption. So it’s vital that policymakers get the mix right.”

Thirdly, she stressed the balance between developments on the design front and the policy front.

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CBN asks Nigerians to trust eNaira

Meanwhile, reported the Central Bank of Nigeria (CBN) had urged all Nigerians to use the eNaria, claiming it is more secure than cryptocurrencies.

This was disclosed by CBN spokesman Nnamdi Okwuosa at the CBN Fair, with the theme, ‘Promoting financial stability and economic development.’

Explaining the benefits of eNaira, CBN said it is more reliable if Nigerians want a digital currency for online transactions.


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