CBN, others will play key role in cryptocurrencies’ use’
The Central Bank of Nigeria and other African countries’ central banks will play an important role in promoting the use of blockchain technology and cryptocurrencies in the future, a financial expert and Chief Operating Officer of United Digital Currency Reserve Foundation, Victoria Walker, has said.
According to her, blockchain technology has created a wave of innovation that has the power to revolutionise business, trade and finance in Africa.
She, therefore, emphasised the need for Africa’s big economies like Nigeria to harness the potential of crypto currencies.
Walker, in a presentation obtained by our correspondent, said, “For example, last year, $22bn was remitted into Nigeria through money transfer companies. Now to send £200 to Nigeria, you can expect to pay 12 per cent in charges. Why? Because in Britain they impose a ‘super tax’ on remittances sent to African countries, causing a loss of £1.8bn a year from money sent home by workers.
“Think about it, £1.8bn is taken away from the people sending money to support their families in Nigeria. Imagine what £1.8bn a year could do in the pockets of families depending on money sent to them from abroad? This is where blockchain technology comes in. It solves a problem like this by making it easier and cheaper to transfer and remit payments internationally.”
According to her, there are already new payment remittance companies using blockchain that make sending payments internationally cost a few pennies.
The COO of the United States-based firm said if African central banks and governments encouraged and fostered this type of innovation, Nigeria and other Africa countries could see more economic growth and prosperity for their people.
According to the expert, leveraging blockchain technology in the Nigerian remittance market alone will see an average of £1.8bn coming into the economy every year.
She said, “But payments and remittances are just one case of how the blockchain and cryptocurrencies can boost economic growth in Nigeria, and Africa as a whole. There are other industries the blockchain can help strengthen in the African economy, for example supply chain.
“Through utilising blockchain technology in the supply chain ecosystem, African countries can open up new opportunities in the global economy, utilising both their natural resources and human capital in a way that has never been done in history.”
According to her, to harness the potential of blockchain technology, African regulators need to understand how blockchain technology works and its use for everyday life.
Walker said, “Many banks and regulators are confused and do not fully understand how Bitcoin and blockchain technology work, but I think once the Central Bank of Nigeria and other key figures get to understand the true nature of blockchain technology and what it can bring economically, I believe they may embrace the technology with open arms.”
Walker also spoke on the sustainability of Nigeria’s borrowing to fund its budget.
She said, “As the interest continues to compound each year, the debt continues to exponentially increase over the years, making it difficult to repay. I believe we’ll eventually move away from the debt-based fiat system in the future, and move to a gold-backed currency again.
“Nigeria has one of the fastest-growing economies in Africa; I don’t see these debts impacting the country too much, especially if Nigeria deploys blockchain to boost economic growth.”