Wrapped CBDC, the private issuer of the cNGN stablecoin pegged to the Nigerian naira, has made ₦15.34 million ($10,500) from accrued income in seven months, according to its September attestation report released on Monday. While its reserves are generating healthy returns, Wrapped CBDC’s long-term profitability hinges on the broader adoption of cNGN among Nigerian users and crypto platforms.
Wrapped CBDC has steadily shifted its reserve mix toward yield-bearing collective investment schemes (CIS) and short-term government paper since March. In the March attestation, the issuer held ₦50 million ($34,000) in a money market fund inside total reserves of ₦152.508 million ($104,000), with the balance kept in bank deposits. The April report shows the same reserve mix and totals.
The May attestation shows a deliberate reallocation: money market investments and similar assets rose to about ₦100.1 million ($68,250) while cash deposits fell to roughly ₦51.108 million ($35,000), leaving total reserves at ₦156.108 million ($106,500).
Over the months, the issuer pushed its holdings in money market funds and treasury bills from an initial ₦50 million ($34,000) to ₦294.96 million ($201,000), representing 48.5% of its reserve portfolio. The issuer now places about ₦152.79 million ($104,000) in a CardinalStone money market fund (MMF) and ₦142.17 million ($97,000) in two short-term Nigerian treasury bills.
The assets cumulatively generated ₦15.34 million ($10,500) in accrued returns, according to filings. Those reallocations convert idle cash into interest-earning instruments and increase the reserves’ capacity to produce operating income while retaining liquidity for redemptions.
How stablecoin issuers make money
Holding reserves in yield-bearing instruments makes clear economic sense for private stablecoin issuers. Cash in a bank account yields little or nothing—but can be instantly liquidated—while money market funds and short-dated government bills pay daily or weekly interest and remain highly liquid. Interest income reduces the net cost of running a stablecoin and creates a buffer that can help smooth redemptions during volatile outflows.
Private stablecoin businesses monetise those interest streams. Major issuers earn income from interest on reserves, transaction and listing fees, and other investments. Tether, the El Salvador-based company and issuer of the dollar-backed USDT token, invests large portions of its reserve portfolio in low-risk, interest-bearing assets such as US treasury bills and cash equivalents, generating substantial interest income.
Additional revenue comes from fees for token issuance, redemption services, account verification, and custodial or enterprise services, and from strategic investments in other digital-asset companies.
Wrapped CBDC appears to follow that model. The stablecoin issuer reports that its primary revenue sources are interest accrued on reserve assets, fees tied to token issuance, and account verification charges for crypto platforms that want to list the cNGN stablecoin. Those fees and reserves interest together form the bulk of the startup’s monetisation strategy.
Stablecoin issuance is primarily a balance-sheet business. The issuer must manage redeemable liabilities represented by tokens in circulation while preserving liquidity and reducing credit and market risk on reserve assets.
This requires three linked functions: custody and safekeeping of reserves, transparent third-party attestations or audits, and ongoing asset-liability management that prioritises immediate redemption capacity. Investors and partners fund growth through equity and venture capital, while the issuer uses reserve yields and fees to fund operations and product expansion.
A User Breakdown of How cNGN Reserves Generate Income
In 7 months, Wrapped CBDC generated ₦15.34M in income from the reserves backing its stablecoin. With ~₦603.05M cNGN tokens in circulation, here’s what that looks like on a per-token level.
Estimated Reserve Backing per ₦1 Token
Estimated 7-Month Income per ₦1 Token
For every ₦1 cNGN token a user holds, Wrapped CBDC has generated…
…in accrued income from its reserves (in 7 months).
Calculate Your Impact
Enter the amount of cNGN you hold (or plan to buy) to see the estimated income its backing reserves could generate for Wrapped CBDC in one month.
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Source: cNGN September attestation report, as cited in the article. Calculations are estimates. Total Reserves = Principal (₦603.05M) + Accrued Income (₦15.34M). ‘Income’ refers to accrued returns, not company profit.
Who is investing in cNGN?
Over the months, several investors and partners have funded the cNGN project without disclosing the amounts.
In September, Adaverse, a Saudi-based venture studio affiliated with the blockchain company Cardano, reportedly made a “significant” investment in Wrapped CBDC. The issuer has also received support from the Base ecosystem and other undisclosed investors.
The May reserve scare
Since launching in February, Wrapped CBDC has published monthly attestation reports showing that its reserves either matched or exceeded the number of cNGN tokens in circulation. In March, the stablecoin had ₦152.5 million ($104,000) in reserves for 152.4 million tokens. April reflected the same balance.
May was the only month that tested the peg. At the end of that month, 156,056,988 cNGN tokens were in circulation while the issuer’s principal reserve stood at ₦151.2 million ($103,000), according to the asset figures in its filing that month. The reserve comprised ₦51.2 million in bank deposits, ₦50 million ($34,000) in a money market fund, and ₦50.1 million ($34,000) in other short-term instruments. The gap was covered by interest income already accrued on those investments, allowing the company to maintain the peg.
The episode highlights a crucial principle. A stablecoin’s peg must rest on its principal reserve, while interest and investment returns should be treated as excesses. These excesses build liquidity buffers that protect the token’s convertibility and give retail holders confidence that redemptions will always clear at face value.
In every other month between March and September, the cNGN’s reserves equaled or exceeded the number of tokens in circulation across all six blockchains where it trades.
Wrapped CBDC’s pegging responsibility
Wrapped CBDC’s core duty is to keep full backing and transparent reporting of reserves. Its monthly attestations from independent auditors have so far confirmed that the reserves—held in bank deposits, money market funds, and treasury bills—cover all outstanding cNGN tokens.
The issuer’s role ends at issuing and managing the stablecoin. Third parties, such as Xend Finance, a Nigerian crypto investment platform, have begun creating products around the cNGN stablecoin. In May, the crypto startup launched a cNGN money market fund that lets users earn returns on their cNGN holdings. Wrapped CBDC has distanced itself from the initiative, claiming that its responsibility is limited to issuing the cNGN stablecoin and maintaining reserve transparency, not managing external investment ventures.
cNGN adoption stalled
Adoption momentum has cooled in recent months. According to the issuer’s filings, cNGN tokens in circulation recorded 298.6 million in June, then jumped to 603.85 million in July. The pace of expansion slowed after that. The most recent filings the issuer provided show circulation at about 603.05 million in September, a small decline from the July peak and a signal that rapid adoption has eased.
For cNGN to win the local retail market, maintaining peg is becoming the most basic of its responsibilities. It must somehow convince more Nigerians that it has utility beyond being a “stablecoin.”
