Nigeria now has its first stablecoin NGNX, according to the CEO of blockchain company KuBitX which recently partnered with Interswitch.
A stablecoin is a form of cryptocurrency with price stability characteristics. It is suitable for short and medium-term use as a unit of account and store of value. It helps with the transition from using fiat currencies like naira to digital assets.
KuBitX's Eric Annon said NGNX, pegged to the Nigerian naira, fits into the company's plan to build a digital assets marketplace for African projects and investors.
Nigerians can use NGNX to pay to over 3000 merchants and send money within and outside the country, Annan says.
He believes its launch will also address hype and misconceptions surrounding blockchain in Africa.
Annon said: "To many blockchain is bitcoin and bitcoin is ponzi in the minds of many policy makers, financial industry players, (and) ordinary people. One can't just ignore such misconceptions -especially when the majority of Nigerians first heard of bitcoin through a popular ponzi scheme called MMM."
"The MMM debacle caused many (to) not even bother to understand what bitcoin is, because it was one of the payment methods in that scheme. There have also been some anti-bank and formal financial institutions (campaigns) by key blockchain players thinking they will do away with banks as blockchain is a disruptive (technology)."
Partnering with a trusted integrated payment company will take blockchain mainstream Annon added.
He said Interswitch has pioneered and succeeded with e-payments in Africa and KubitX will leverage Interswitch's fiat gateway to make financial services more accessible to more people in Africa.
He agrees that this is crucial since cash still plays a key role in Africa and there is a growing interest in digital assets by the teeming young population
"Blockchain will become mainstream and (will be) the most used solutions in Africa in the next five years," Annan said.
He adds that there's an impressive number of blockchain-related start-ups compared to the internet era.
"We need this solution more than any other continent. We have more in-terms of infrastructure, economic empowerment and social impacts. So to us, mainstream adoption of all blockchain-based services can't be complete if we don't make the formal financial institutions a part of the future."