A cashless society: the International Monetary Fund (IMF) calls it the future of money. The World Economic Forum (WEF) was enthusiastic about the concept way before it was cool. In the United States, the usual suspects such as the Brookings Institute and the New York Times ask our leaders to have the boldness and courage to follow this new path.

It would go like this: instead of having paper money, central banks would start to create a digital currency. All transactions outside this system would eventually be forbidden.

Supporters say that the benefits of this path outweigh the risks. Mainly, “digital cash” can’t be lost and transactions will have reduced costs, operating in a smoother way than they do today. Supporters of these digital currencies point out that they could have the potential to include billions of people previously excluded from the banking system. 

Is that true though? Let’s see what our brothers and sisters in Nigeria who were recently forced into a cashless society experiment think about it.

Central bank digital currency in Nigeria

Applauded by the IMF, on October 25, 2021, the Nigerian government launched Africa’s first central bank digital currency: the eNaira.

The movement for the eNaira didn’t come out of nowhere. 

Nigeria is one of the most Bitcoin-savvy countries in the world. One recent study found that one third of all adults in the country trade with Bitcoin or other cryptocurrencies. 

Yet, despite being one of the societies most open to digital currencies, Nigerians largely ignore the eNaira. One year after its launch, only 0.5 percent of the Nigerian population used the “future of money.” 

To turn things around, the Nigerian government started with the carrot approach.

In August 2022, it removed access restrictions so that bank accounts were no longer required to use the CBDC. Then, in October, it offered discounts if people used the CBDC to pay for cabs. But that still didn’t change anything. 

Then, the government started to behave like governments usually do, resorting to the stick.

In December 2022, the Central Bank of Nigeria began restricting cash withdrawals to 100,000 naira (US$225) per week for individuals and 500,000 naira ($1,123) for businesses.

But even that didn’t stop the Nigerian population from rejecting the eNaira, and it Isn’t hard to imagine why. 

Adopting the eNaira would mean trusting that the Nigerian government would never abuse its powers to spy on the financial transactions of its citizens, freeze accounts in the blink of an eye, or even control what Nigerians can buy. Furthermore, in a society where only the eNaira is available, the Nigerian government could even seize the entire population’s money with a click. 

To address the concerns of its citizens, the Nigerian government decided to simply ban any cash transactions after February 10, 2023. A crystal clear logic: if you can’t use paper money, you will use eNaira, whether you like it or not. 

But that didn’t happen. The majority of Nigerians did not start using the eNaira. Instead, on February 16, 2023, violent riots erupted across the country as people became angered that their paper money didn’t have value anymore.

Nigeria’s experiment ended after just 108 days when the newly elected president, Bola Ahmed Tinubu, restored the validity of the old currency, alongside the new naira and eNaira.

By now, even after the government’s many attempts and despite one third of the country using Bitcoin, only 5 percent of Nigerians use the eNaira.

Will we heed the Nigerians’ warning?

Despite losing one battle in Nigeria, the war isn’t over for the cheerleaders of CBDCs — and they remain powerful!

In November 2023, the head of the International Monetary Fund urged countries to make a more proactive push to develop central bank digital currencies.

The truth is: they are concerned. The increasing use of Bitcoin and other cryptocurrencies are eroding the state’s control of money. And the state needs to control money in order to control society. 

Indeed, the fact is that Bitcoin created a fight or flight situation for governments around the world. If they do nothing, they will slowly see their power decrease in the next decades, becoming increasingly obsolete. BUT, if they implement CBDCs, they will be more powerful than ever, wielding powers that even Stalin and Mao Zedong could only dream of. 

For many, central bank digital currencies might seem like one of the most, if not the most, boring and technical subjects they could encounter in life. Yet they are the most existential threat to freedom in our lifetime.

On February 2-4, 2024, Students For Liberty (SFL) will gather Stephan Livera, Robert Breedlove, and Peter St. Onge — three Bitcoin experts — in Washington D.C., to discuss how we can fight back and prevent CBDCs from being implemented. 

That encounter will take place at LibertyCon International, SFL’s flagship event with attendees from more than 30 countries and many young, pro-liberty students.

Wanna know more about it? Visit the official website, check out the speakers, look at the schedule, and buy your tickets before they sell out!

This piece solely expresses the opinion of the author and not necessarily the organization as a whole. Students For Liberty is committed to facilitating a broad dialogue for liberty, representing a variety of opinions.