At Independence day, like any Birthday, we need to review progress, recognize challenges, and reaffirm commitment to the Future.
Publicly announcing congratulations to everybody for Nigerian Independence Day is always a challenge for me. The problem is, not every Nigerian feels the same way.
Some are very pleased I say it, some are at best ‘bemused’, while others can be quite critical of gestures they see as well meaning but flat. Those who believe in one form of self-determination or the other, may even see my good wishes as enemy propaganda !
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It’s a Birthday. Like a personal birthday, like the birth of a new calendar year, or a company financial year, the principle is the same. As people or as businesses we look at what we have done, we give ourselves ‘measured’ congratulations, if not for anything else, then for the fact that we are still here, and we look with renewed vigour to the year ahead.
So it should be for Nations.
It’s been a tough year for Nigerians. It’s been a tough year for my Nigerian family. So we wear our ‘brave’ face and we emulate the typical style politicians adopt when campaigning for a second term, when the first one didn’t quite close out as planned – wheel out the old ‘Much done, much yet to do’ speech.
So I will do the same as I have done, pivot on something that bridges the old with the new.
This year it will be: eNaira.
On first thoughts, eNaira would seem to have been the perfect choice – why? Well, as a sovereign digital currency it perfectly blends the old with the new. And it was slated to debut on Independence day. It didn’t.
Could CBN, and by inference, FGN be getting cold feet?
Authored in August 2017 and later used as a support audio to Mini MBA co-learners, Prof. Ndubuisi Ekekwe said this:
‘…A digital currency in which encryption techniques are utilized to regulate the generation of units of currency and verify the transfer of funds without necessarily (being) within the constructs of the Central Bank….faster.. better… without any central bank controlling it.
Suddenly you are trying to say, there is this kind of money…where the central bank, is not necessarily in control.’
The implication here is that plans to develop eFIAT, i.e. CBDC were a result of sovereign nations becoming fearful of this new disruptive value instrument and they wanted to come up with their own sovereign controlled digital alternative.
Governments have been in control of ‘tokens’ that represent value but are not the value themselves all the way back to the first ever official currency, minted around 600 B.C.in the kingdom of Lydia (modern day Turkey). Currency is 2600+ years old. Perhaps this being disrupted is not popular with them.
Leading up to the shelved launch, Nigeria Gazette carries a story: ‘E-naira is better than cryptos, says CBN’ – but is it really? Or in particular, is it any safer?
In 2013, an iconic speech delivered by the UK MEP (Member of European Parliament) Geoffrey Bloom, addressing the European Parliament had this to say:
‘All the banks are broke – Santander, Deutche Bank, Royal Bank of Scotland.. they are all broke… They are broke because of a system called ‘Fractional Reserve Banking’ which means banks are allowed to lend money they don’t have’…It’s a criminal scandal, and it has been going on for too long… You have ‘moral hazard’, a very significant moral hazard from the political sphere… most of the problems start in politics, and with Central Banks, which are part of the same political system…
We have counterfeiting... sometimes called ‘quantitative easing‘ but counterfeiting by any other name… the artificial printing of money… which if any ordinary person did it, they would go to prison for a very long time…and yet, governments and central banks do it all the time…and when banks go broke… the taxpayer picks up the tab… its theft from the taxpayer… and until we start sending politicians and central bankers to prison, it will continue..’
Meanwhile China dreams of the e-Yuan amidst an economy and banking system that may implode due to the ‘Evergrande Scandal’. It faces new trade challenges with Australia adding to those with US, and one of its flagship brands, Huawei is still banned in several markets on security risk suspicions. It has also talked itself into a corner with rhetoric about annexing Taiwan, forcing itself into an expensive military build up at a time its economic shape is least prepared for. It’s latest move is to ban CoinMarketCap, CoinGecko at its Firewall.
An article I did in June ‘Will NFT hyper-investing bring a new ‘dot com’ style boom and bust?’ made a conclusion amid a possible NFT pandemic on quality differentiation: ‘Sometimes rubbish is just rubbish even if there is blockchain technology providing the proof of authenticity that it is rubbish.’
Well edit that to ‘Sometimes quantitative easing is just counterfeiting even if there is blockchain technology providing the proof of authenticity that it is counterfeiting.’
If anything, CBDC i.e. eNaira makes quantitative easing far easier, as the ‘artificial’ capacity can be just pumped into circulation at the flick of a switch – no printing!.
“The planned unveiling on October 1, 2021 has now been deferred due to other key activities lined up to commemorate the country’s 61st Independence” Anniversary,” the CBN spokesman said in a statement on the bank’s Facebook page… Well it isn’t as if Independence Day can be filed under ‘unforeseen events’. This may be a mask for other reasons.
Perhaps an FGN with a little over a year of its regime left is having pause for thought. If the next regime starts dipping its hand in for cookies the public may not blame them but may ask.. who are the ones that brought the jar? This may be an effort to quietly backpedal.
So… can the government be really trusted by the people to have a CBDC?
Well, if the people truly believe no Nigerian Government or banking regime has ever been capable of even the slightest smallest fraction of corruption and malpractice Geoffrey Bloom believes the European institutions have committed… then yes, of course!
I hope all my Nigerian readers had a great day.. there is now only thirty minutes left as I finish this.. We move!
Citations, referenced articles and additional reading:
gazettengr.com/cbdc-e-naira-is-better-than-cryptos-says-cbn/
www.tekedia.com/will-nft-hyper-investing-bring-a-new-dot-com-style-boom-and-bust/
tinyurl.com/crypto-fiat
www.rootstv.ng/news/2021/09/e-naira-is-better-than-cryptos-says-cbn/
coinmarketcap.com/headlines/news/coingecko-coinmarketcap-blocked-china-internet-firewall/
www.breitbart.com/national-security/2021/08/18/china-threatens-crush-u-s-troops-taiwan/
coinhighlight.com/2021/09/indonesia-finance-minister-warns-of-ripple-effect-from-chinas-evergrande-debt-woes/
www.msn.com/en-sg/news/world/nigeria-delays-launch-of-enaira-digital-currency/ar-AAP1Svi