Nigeria’s new digital currency was developed by an Overstock.com subsidiary

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Sarah Tew / CNET

The Central Bank of Nigeria on Monday launched a digital currency designed to be used alongside its physical currency. The release of eNaira was officially announced via a press release issued by the Central Bank of Nigeria.

A central bank’s digital currency is a form of cryptocurrency controlled by a country’s central bank. More than 100 countries, including the United States and China, are exploring the development of a CBDC, according to the IMF.

The first CBDC to be launched in Africa, eNaira was developed by Bitt, a Barbados-based fintech company that also developed a CBDC called DCash for the Eastern Caribbean Central Bank earlier this year. Medici Ventures, a venture fund originally formed as a subsidiary of Overstock.com, acquired a controlling stake in Bitt. Medici Ventures is now part of a limited partnership controlled by Overstock.com and Pelion Venture Partners, a venture capital firm.

“Overstock has always focused on developing and developing new and emerging technologies,” Overstock CEO Jonathan Johnson said in a statement to CNET. “In 1999, the new technology was the Internet and e-commerce. Several years ago, we formed Medici Ventures as a subsidiary to focus on another new and world-changing technology – blockchain.”

Overstock.com, an online store that sells furniture and home appliances, became the first major retailer to accept Bitcoin payments worldwide in 2014. Overstock’s interest in crypto has continued, and its subsidiary has invested in more than 20 blockchain startups since as. According to Johnson, there is “no direct connection” between Bitt’s business and Overstock’s core e-commerce business.

Nigeria’s economy is the largest in Africa with an annual GDP of around $ 432 billion. In 2020, the country’s economy declined due to a COVID-19-driven rise in unemployment and reduced demand for exports. Although economic conditions have improved, by 2020, more than a third of Nigerian adults were bank-free.

The new digital currency could potentially expand economic opportunities for Nigerians and give them access to a digital wallet available via smartphone. Two digital wallets supporting eNaira were also launched on Monday. These wallets, the eNaira speed wallet and the eNaira merchant wallet, are now available for download from the Google Play Store and Apple Store.

On Monday, President Muhammadu Buhari said eNaira – and the blockchain technology that supports it – has the potential to grow Nigeria’s GDP by $ 29 billion over the next decade. Yet his country‚Äôs embrace of the new technology has been limited and highly controlled. In February 2021, the Central Bank of Nigeria prevented the nation’s banks and financial institutions from using cryptocurrency. Despite the ban, cryptocurrencies remain popular in Nigeria, seen as a way to protect against volatility and execute commercial transactions.

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