The very first stablecoin of Africa is backed by Naira, the fiat currency of Nigeria and it will be built on Binance Chain, the blockchain software system developed by the leading cryptocurrency exchange Binance.
Ghana-based cross-border money transfer startup Bit Sika in partnership with a crypto-focused investment firm Linova Capital will be launching a Naira-backed stablecoin called Africa Stablecoin (ABCD).
Kicking into gear…
The idea behind using Naira for its stablecoin project is the rapid increase in the use of Bitcoin in the country, Atsu Davo, founder and CEO of Bit Sika told a local news website. Davo said,
“Nigeria is one of the busiest places for cryptocurrency in Africa right now, and while we have plans to include other African currencies in the future, the country is a good starting place for us.”
Despite the regulatory uncertainty in the continent, Africa has garnered the top spot when it comes to Bitcoin searches on Google.
In fact, according to Twitter and Square CEO Jack Dorsey Africa will define the future of Bitcoin. He has already started seeing technopreneurs in the continent to tap into the crypto industry.
More to Come…
Binance already allows Nigerians to buy crypto on its platform using their fiat currency Naira in partnership with Lagos-based fintech startup Flutterwave.
Bit Sika first joined Binance Labs Incubation Program this year. Now, ABCD is ready to leverage the liquidity of naira. Davo explained,
“Many people have a hard time differentiating cryptocurrencies and knowing their actual value in their local currency. There are a lot of digital currencies backed by the US dollar. We have seen how well they do,”
“But I feel we also need cryptocurrencies that are compatible with African national currencies. People can easily acquire US dollars, but still choose to spend their local currencies. This illustrates the power of familiarity, which we aim for.”
With this stablecoin, the company is planning to provide a bridge between the legacy system and decentralized system.
Naira might not be one of the strongest currencies in Africa but Bit Sika is just getting started. The company has future plans to build decentralized applications running fiat currencies like Nigerian naira and more stablecoins for other African fiat currencies, as per its whitepaper.
This article is Originally posted on CoinCentral.com