Inside WrappedCBDC’s plan to turn the naira into a high-speed digital rail

WrappedCBDC set out to fix how Nigerians move money with a naira-backed stablecoin. After 11 months and 1 billion tokens issued since its launch, the company is now trying to prove that a digital currency backed by a “volatile” naira can earn real trust and serve as a rail for easing naira movement.

Compliant Naira (cNGN), the stablecoin backed by the local currency, was first listed on the provisionally licenced Nigerian cryptocurrency exchange, Busha, on February 3, 2025, but the vision to democratise access to digital naira was two years in the making. WrappedCBDC, the issuer of the local stablecoin composed of Convexity Technologies, Interstellar, and AlphaGeek, created the cNGN as a response to the difficulty Nigerians face buying dollar-based stablecoins and have to route them back to the fiat naira, losing money from transaction fees.

“Before launch, cNGN went through over two years of technical, regulatory, and operational groundwork,” said Uyoyo Ogedegbe, managing director of WrappedCBDC/cNGN. “The focus was on getting it right rather than rushing to market. That meant engaging regulators and policymakers early, performing extensive smart contract audits, and building a transparent framework for reserves, attestations, and redemption.”

Those early lessons remain the backbone of cNGN’s operations today as it tackles the difficult challenge of building a naira-backed stablecoin, Ogedegbe added. Dominant stablecoins—digital currencies tokenised using blockchain technology—are usually backed by the US dollar. By digitising the US dollar, access to dollar-backed digital currencies became much easier, significantly accelerating the adoption of dollar-backed stablecoins in emerging markets. 

Yet for WrappedCBDC, bringing the naira on-chain was a way to digitise the currency’s value, despite its historical volatility (with wild swings seen between 2023 and 2024). cNGN is backed by cash deposits held in local bank accounts (for easy liquidation) and short-term securities, keeping assets that are pegged 1:1 to the naira onshore. As of October 2025, bank deposits make up 54% of its reserve, while treasury bills and a money market fund managed by CardinalStone, a Nigerian asset management firm, make up the remaining 46%, according to its last audit filing.

Everybody wants a piece of stablecoin

Since its launch, WrappedCBDC has drawn strong investor interest. Fast Forward Venture Studio, an early-stage venture studio that has backed Bumpa (a Nigerian e-commerce startup) and AltSchool Africa (an edtech), invested $100,000 in the local stablecoin project, according to three investors familiar with the studio’s business.

“System records like this [cNGN] open up things you thought were not possible,” said Opeyemi Awoyemi, general partner at Fast Forward Venture Studio. “Now, crypto players can offer yield. It also creates demand for the naira, opening up markets and different opportunities. Trading becomes easier when a Chinese company doing business in Nigeria can now hold naira through the cNGN, without opening a bank account, instead of holding dollars for trade. That’s why we invested.”

Coinbase Ventures, the investment arm of the US crypto firm, and Circle, the NYSE-listed issuer of the USDC stablecoin, have also backed the cNGN project with undisclosed strategic funding, according to Awoyemi, matching several media reports. DeFi Technologies, a Nasdaq-listed fintech company, invested in the project per an October US filing; Adaverse, a venture studio which runs an ecosystem accelerator for Cardano, a layer 1 blockchain platform, is also an investor.

While the cNGN is issued by WrappedCBDC, a private company, the stablecoin is regulated and compliant with auditing and security requirements under the Nigerian Securities and Exchange Commission (SEC’s) Regulatory Incubation (RI) sandbox programme. 

Before cNGN, Nigerians who wanted to protect their savings from naira volatility bought dollar stablecoins like USDT or USDC, and relied on peer-to-peer (P2P) desks, crypto exchanges, or other fintech apps to get back to fiat naira, paying a mix of spreads, platform charges, and network fees along the way.

With cNGN, users get a naira‑backed stablecoin that allows value to move from USDT/USDC into a digital naira rail, and then into fiat naira, with cheaper, more transparent fees, and fewer FX‑style conversions in the middle.

Keeping the cNGN pegged to the naira

Keeping cNGN at 1:1 to the naira is the single most important technical and operational requirement of the project. Everything WrappedCBDC has built revolves around preventing any gap between tokens in circulation and naira held in reserve. The process begins the moment a user decides to buy the stablecoin.

When a user buys cNGN, for instance, 10,000 tokens, WrappedCBDC assigns a dedicated bank account to that user alone. The equivalent naira amount must be deposited in that account before any cNGN token is created. The treasury team checks the deposit and updates the internal dashboard once the money settles. This generates a “mint” request that cannot proceed until several authorised staff approve it under a “t-of-n” structure. This control structure prevents anyone from minting unbacked tokens on their own and reduces operational risk.

“The day-to-day process blends automation with human oversight,” said Ogedegbe. “The engineering team maintains blockchain integrations, audits, and platform security. The compliance unit manages onboarding and regulatory reporting under the SEC’s RI programme. When a verified entity initiates minting, funds move into reserve accounts before any tokens are issued.”

Only after these checks does minting occur. The tokens are first created on the Bantu blockchain, which WrappedCBDC uses as the primary ledger for supply control. Bantu holds the authoritative record of circulating cNGN before tokens move to other chains.

“Tokens are only minted after confirmed settlement in the reserve account,” said Ogedegbe. “Every cNGN token in circulation is backed by at least one naira in reserve, and we designed the entire process to prevent mismatches at any point. No one can mint on their own, and every mint is tied to a verified deposit.”

The reverse happens during redemption. When a user sends cNGN back to WrappedCBDC and requests fiat naira, the tokens are “burned.” Burning permanently removes those tokens from circulation. Once the burn is confirmed on-chain, the treasury team releases the naira from its reserve. 

Every cNGN in existence corresponds to naira deposited into WrappedCBDC’s reserve account and verified by its treasury team. This constraint governs the business and maintains the peg to the local currency.

cNGN is a multi-chain stablecoin product, meaning it is accessible on several blockchains, including Base, Asset Chain, Bantu, Polygon, Binance Smart Chain, and Ethereum, so the same sequence applies in a cross-chain transaction, eliminating double usage and keeping output tightly linked to reserves.

Cross-chain transfers follow the same logic. WrappedCBDC uses a burn-and-mint system rather than a lock-and-mint model. For a user moving tokens from Bantu to Base, for example, the cNGN on Bantu must be burned before new tokens appear on Base. The signing keys required for minting are stored in a hardware security module (HSM), and approval requires multiple signers through a safe multi-signature wallet.

This structure enables the team to avoid errors, such as accidentally overminting tokens or mismatching balances across networks. It also ensures that balances remain fully auditable.

WrappedCBDC publishes monthly attestation reports prepared by Big & Co, an independent Nigerian accounting firm, to show that its reserves match or exceed circulating tokens. The company added extra layers of internal review after a clerical error in an earlier filing in May, first reported by TechCabal.

The peg remains vulnerable if reserves are not liquid enough for redemptions. WrappedCBDC holds roughly half of its reserves in cash deposits and the balance in short-term securities that can be liquidated quickly. The approach is consistent with global liquidity-first models used by leading stablecoin issuers. For instance, Circle holds its USDC reserves in bank deposits, short-dated US Treasuries, and Overnight Reverse Treasury Repo.

“Our reserves remain fully liquid and redeemable at all times,” said Ogedegbe. “We built the system so that users do not have to worry about whether their redemptions will clear.”

The peg isn’t supported by the naira’s value, but the operational structure WrappedCBDC has built around it: verified deposits, controlled minting, enforced burning, and continuous reconciliation that ties each token to a specific unit of fiat currency.

The business of stablecoins

For WrappedCBDC, the commercial logic behind the cNGN stablecoin is straightforward. Although dollar stablecoins dominate global markets, much of Nigeria’s digital finance activity revolves around the naira. WrappedCBDC built cNGN to support that segment. Fintechs, traders, remittance operators and developers need faster rails to move money without relying entirely on bank integrations that can be slow or inconsistent.

The company’s revenue comes from minting and redemption fees, and interest earned from reserves held in treasury bills and money market funds. WrappedCBDC prioritises liquidity ahead of yield.

“Reserves are never compromised for speculative yield,” said Ogedegbe. “They remain fully liquid and redeemable at all times, which is central to how users assess trust.”The company has reached meaningful scale. As of December 12, more than 1 billion cNGN tokens were in circulation. In practical terms, this means WrappedCBDC holds more than the corresponding ₦1 billion in cash and cash equivalents in its reserve accounts. This spike in adoption has mostly been driven by activities on Base and Asset Chain, two blockchains currently driving this all-time high.

Transaction value has also grown quickly. In November, cNGN recorded $7.03 million in transfers across four major chains: Base, Ethereum, Binance Smart Chain, and Polygon, according to Dune Analytics. This was a 539% increase from August, since the blockchain analysis firm began tracking the data. The numbers exclude transfers on African blockchains such as Bantu and Asset Chain.

WrappedCBDC has deployed cNGN on testnets for Lisk, Monad, and Arc, where developers can build with the token before deploying to live networks. The testnet contract addresses are publicly available on cNGN’s website. Multi-chain access is central to the company’s strategy. The more blockchains cNGN is on, the fewer restrictions developers and crypto exchanges face when trying to integrate a naira-based payment rail. This also creates wider access and choice for last-mile users, scaling adoption.

Running a stablecoin business can be a profitable venture if adoption scales, but it also requires deep reserve pools as it grows. This means liquidity is a critical aspect of staying in business. Stablecoins only function well when issuers can meet redemption requests instantly. 

WrappedCBDC says it benefits from operating within a broader ecosystem of companies that have generated revenue for years and built relationships with partners able to supply liquidity as scale increases.

Using the cNGN stablecoin

The more pertinent question is why anyone should use a naira-backed stablecoin. The classic value proposition for stablecoins focuses on speed, lower settlement costs, and broader access. These benefits remain relevant, although the underlying currency determines its appeal. In an environment where the naira loses value, many users prefer dollar-denominated stablecoins for savings or a long-term hedge.

cNGN does not protect the naira’s value; it moves the currency faster. For businesses that rely on predictable settlement, that difference matters. Developers can build programmable payment systems without managing fragmented banking connections. Fintechs can reduce reconciliation errors. Merchants can accept payments without waiting for clearing delays.

But the structural weakness remains unchanged. A naira-backed stablecoin inherits the naira’s volatility, and a depreciating currency produces a depreciating digital equivalent. WrappedCBDC does not try to position cNGN as a hedge. Ogedegbe describes the token as infrastructure.

“WrappedCBDC set out to create a Naira‑backed token that would give Nigerians a way to hold and transact their own currency on‑chain while meeting the same security, compliance, and consumer‑protection standards as a regulated payment instrument,” said Ogedegbe. “cNGN now provides a multi‑chain infrastructure with audited smart contracts, monthly attestations of reserves and ISO 20022‑aligned messaging so that fintechs and banks can integrate the token into everyday payments, remittances and Web3 applications. The objective is to make cNGN a bridge between Nigeria’s fiat system, the eNaira, and the broader digital economy in a way that is transparent, secure and fully in line with domestic and international regulation.”

Yet, with stablecoins generally, there is a layer of risk if they become widely used as designated banking rails. Holders of private stablecoins generally do not have a legal right to the underlying reserves if the issuer becomes insolvent. While in traditional banking, customer deposits are insured, stablecoin holders depend on the issuer’s solvency and operational integrity. This is why provable reserves are important. WrappedCBDC publishes monthly attestation reports and records all mint and burn events on-chain, so users can track supply. Transparent reserves do not eliminate risk, but they help anchor trust.

WrappedCBDC’s team spans compliance, engineering, treasury management, support, and partnerships. The treasury team manages reserves and redemption flows. Engineering manages smart contracts and blockchain activity. Compliance handles reporting under the SEC’s RI programme. Partnerships manage integrations and exchange listings. Customer support handles user onboarding and queries, typically interfacing with business partners and exchanges listing the stablecoin.

The value of the cNGN may not lie in its monetary strength or value of the digital currency, but in the rail it is building. If Nigeria’s financial system is defined by friction in moving money, a digital naira rail that settles instantly could support use cases in trade, commerce, cross-border transactions, and software infrastructure. WrappedCBDC is betting that users may not hold the naira, but they will use better infrastructure to move it.