The value of transactions using the central bank’s digital currency (CBDC) in Nigeria increased by 63% to $47.7 million (around 22 billion), and since October 2022, 13 million e-naira wallets have been downloaded, according to the governor of the central bank in Nigeria. The currency in circulation decreased from over $6.9 billion (3.2 trillion) observed in September 2022 to over $2.2 billion (1 trillion), according to Governor Godwin Emefiele, who spoke to local journalists on March 21.
As previously reported by Bitcoin.com News, the Central Bank of Nigeria’s (CBN) disastrous demonetization program has been blamed for the decline in the value of current naira banknotes. The central bank of Nigeria granted Nigerians a few months to return their old 200, 500, and 1,000-naira banknotes after declaring its intention to circulate newer designed banknotes.
Violent protests and requests for an extension of the deadline were provoked by the CBN’s perceived short repatriation period and its failure to provide enough banknotes of the newly designed naira. The CBN, however, gave in and announced that the previously demonetized banknotes would continue to be legal tender till the end of the year after the Nigerian Supreme Court decided against the demonetization process.
However, despite the CBN’s about-face, both old and new naira banknotes are said to still be in low supply. Some Nigerian analysts believe that this may assist to explain why the value of e-naira transactions has suddenly increased.
Although it is estimated that the CBN issued more than 10 billion of the digital currency, the governor claims that just 3.4 billion of the CBDC are currently in use.