A look at eNaira, Nigeria's 18-month-old government-backed digital currency that hasn't converted crypto users and has been hindered by limited internet access
Temitayo Lawal / Rest of World :
Context & Ripple Effects
The Central Bank of Nigeria built eNaira with payments startup Bitt Inc. and launched it in October 2021, minting 500M coins and putting wallets on Android and iOS. Early numbers looked respectable — 488,000+ wallet downloads and roughly 78K merchants enrolled within weeks.
But downloads never became usage: a year in, less than 0.5% of Nigerians used eNaira, prompting the government to add adoption incentives. That matters because Nigeria was second only to the US in bitcoin trading volume when the project began — the state currency was built to win back exactly the users who had already settled on crypto, and this piece reports they haven't switched.
First-order effects
- Eighteen months post-launch, eNaira has failed its core test: converting Nigeria's large existing crypto user base, leaving the central bank with a live currency whose adoption rests on government incentives rather than organic demand.
Second-order effects
- With persuasion failing, the government's posture hardens — by early 2024 it ordered telecoms to restrict access to major crypto exchanges including Binance, Coinbase, and Kraken, narrowing the alternatives to state-backed rails.
Third-order effects
- If the pattern holds, CBDCs in markets with strong grassroots crypto adoption will compete on coercion and infrastructure — internet access, wallet distribution, merchant enrollment — rather than product appeal; and citizen trust is a further constraint in a country reported to have spent $470M on Chinese-built facial recognition and movement-monitoring surveillance technology.
The trend: State-launched digital currencies are discovering that where retail crypto is entrenched, governments increasingly pair CBDC rollouts with pressure on private crypto access instead of winning users on utility.