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In the last decade, there has been an upward trend in the acceptance rate of cryptocurrency among young Nigerians. According to Ijeoma Ndukwe, more cryptocurrency trades happen in Nigeria than in any other part of the world, showing the loss of faith in traditional investment forms. In the same article, most of the interviews show that young Nigerians have seen cryptocurrency as an escape from the dwindling economic situation of the country.
With many young Nigerians looking towards digital currencies, crypto has become a tool for investment. In addition, there are different young Nigerians that pass their time with gambling and online casinos. So, they look to the best bitcoin casinos and bonuses for entertainment through cryptocurrencies.
The Impact of Cryptocurrency in Nigeria
There is no doubt that the introduction of cryptocurrencies has had a massive impact on the country, especially on the youth. The country has seen impressive growth thanks to crypto. For instance, in 2020, a Nigerian crypto-trading company, Bifxt, raised $15 million in its Series A funding, creating more jobs and investments to improve the economy. In addition, crypto has improved the way people transact and make payments. Sending money from Nigeria is pretty difficult, but the arrival of crypto has made it easier, eliminating the hassles of long bank queues and waiting hours. Also, the transfer fee from one wallet to the other is not relatively small.
In addition to that, during the #EndSARS nationwide protest, cryptocurrencies such as Bitcoin served as one of the propelling forces to the movement. Protest groups received financial support to sort feeding, legal and medical bills for protesters. As a result, it made mobilization easy, resulting in a delightful, peaceful protest for the first few days. Besides that, cryptocurrencies have helped many young Nigerians break the poverty line. We now have several crypto multi-millionaires living off their investment in various digital currencies.
However, there is a growing concern regarding Bitcoin and other cryptocurrencies’ soaring value. Many experts see it as a speculative bet that might leave investors in complete ruin one day. They also believe it to have technical uncertainties, and since it relies on anonymity, there is a chance that it can bolster scams, which is already a problem the country is facing. This concern led to the complete ban of cryptocurrency in the country. The statement released on the 7th of February, 2021, cited that the ban was to protect the public and keep the country from unknown and unregulated entities suited for conducting illegal activities.
Because of the ban, many investors have seen their bank accounts seized, put on hold, or frozen by the central bank. As of today, it is illegal to trade cryptocurrencies or crypto-related entities. There is a possibility that in the future, the government sees the potential in cryptocurrency and how it can positively impact the country, thanks to the new innovative ideas of the industry.
Trends and Projections
Even with the official ban on crypto, the country has continued to witness a boom in the use of digital currencies for transactions, payment, and investments. Many users have found a way around the ban, and since there is no explicit law against the use of cryptocurrencies, people can still trade and perform peer-to-peer transactions. In March after the ban, a Reuters report showed that the cryptocurrencies volume sent from Nigeria increased to about $132 million, taking it up to 17% from the last month. In addition, transactions in June went up 25% from the previous month as well. As a result, the Nigerian bitcoin market has grown to become only second to the US market.
In the last 5+ years, Nigeria has traded over 60,000 bitcoins with a valuation of more than $500 million. The Nigerian bitcoin market has been projected to increase by at least 19% in volume since 2017. The market in 2020 with more than 20,000 volume traded. One of the reasons the market continues to witness growth is that it allows Nigerians to source funds in other currencies to preserve the dwindling currency value, making it more of a business than speculation. As the market grows and despite the ban, the government launched its first digital currency, showing promise of a bright future for cryptocurrencies in Nigeria.
Bottom Line
The crypto industry remains a vital source of income for Nigeria’s young demographics. With the success of cryptocurrencies, it is hard to convince this part of the population that meddling in the industry is a bad idea, especially for a country with many promising potentials but few working infrastructures. As a result, the growth of cryptocurrency is definitely beginning to affect Nigeria, but in a good way.
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