By Peter Egwuatu
An economist, Tope Fasua, has advised the Central Bank of Nigeria, CBN, to float a sovereign digital currency given the rise in value and global acceptability of cryptocurrencies.
Fasua, who is also Chief Executive Officer of Global Analystics, stated this at a virtual forum organized by the Finance Correspondents Association of Nigeria (FICAN). Speaking on the topic, “Ban on Cryptocurrency-related accounts in Nigeria and concerns of global central banking,” he said that Central Bankers have no option than to start issuing their own digital currencies.
According to him, five countries namely China, Ecuador, Senegal, Tunisia and Singapore, have issued independent digital currencies, as opposed to Cryptocurency, being fully aware of the potential danger cryptocurrencies pose to traditional currencies.
He said quite a number of bankers have invested in cryptos just to hedge their bet. But the traditional financial system is deeply rooted, organized and backed by the government, unlike the Cryptocurrency mining space.
Fasua however said the advocates of cryptocurrencies believe that there is a need to push back and do something different that will mimic the attributes of a gold-backed currency in durability and scarcity, but better than the current system in terms of being smart, secure and not possible for central banks to issue at will.
He said “If it started as a rebellion (which is the case), then you must think of the incentive for the global economy to sign on to that rebellion with you against the devil they know. This then means that until there is global acceptance of the currencies, it will continue to be easy to create panic in the crypto world and big players can dump the currency when they have achieved gains.”
According to him, cryptocurrency is heading to global single currency but one major challenge is that there are a lot of losses in it and that when most coiners die, no one is able to access their investments which are encrypted with passwords, passphrases.