Nigerians 🇳🇬 trading crypto despite the Govt. Ban.

Over the last few years, Nigeria has been a country that is known for its tech-savvy. However, when it comes to the number of people that own cryptocurrencies, Nigeria ranks right at the top. The number of cryptocurrency exchanges and businesses in Nigeria is also quite large.

The Nigerian government hasn’t made the use of cryptocurrency completely illegal yet, but the ambiguity around the legal status of cryptocurrency and the existing ban on foreign exchange centers have made things difficult.

Crypto in Nigeria has become a very big deal. The country is among the top 5 countries in terms of crypto adoption worldwide. While the crypto space has been introduced to Nigerians through online medium, some Nigerians are still interested in buying crypto from the exchanges in person. This has given rise to crypto exchanges in Nigeria.

Crypto exchanges in Nigeria act as third-party marketplaces for individuals looking to buy or sell their cryptos with other individuals or businesses. These marketplaces allow anyone looking to trade their cryptos to do that for a fee that is added on top of the already existing price of the cryptocurrency. This allows users/businesses to not worry about the price volatility of cryptocurrency as they can just exchange their coins for cash at anytime.

Despite the ambiguous legal status of digital assets in the country, the adoption of crypto is increasing day by day in Nigeria. It has become a lifestyle for many young people to own at least one token of some cryptocurrency and that is an indication that it has become mainstream in Nigeria. A lot of people have started taking up crypto jobs. There are also companies that have started making money from recommending their clients buy bitcoin in Nigeria. The buying and selling of bitcoin in Nigeria is done on peer-to-peer exchanges or through brokers. Though the decentralized exchange or DEX looks like the future, there are still many people who prefer centralized exchanges because it offers a lot more liquidity than the decentralized ones. It is hard for Nigerians to buy bitcoin because there are so many things that they should consider especially those who are buying cryptocurrencies for the first time. Many exchange platforms will ask you to upload your identification documents before they can offer you their services.

The situation is quite a paradox when one considers the fact that Nigeria’s government has prohibited the use of cryptocurrencies as a means of payment since February 5, 2018. This ban has not helped the adoption grow, but its adoption has skyrocketed. The country has remained one of the leading countries in adoption, despite the ban. It is for this reason that you will find buyers and traders of digital assets in every Nigerian state.

There are many reasons as to why crypto is growing in popularity in Nigeria. First of all, the country has a big problem with corruption. In 2016 alone, over $20 billion was stolen from the public treasury. As a result, the government wouldn’t take too kindly to crypto if it weren’t for the huge potential that it offers. It is well known that crypto offers a lot of opportunities for less-developed economies such as Nigeria.

Why the ban on crypto in Nigeria

The Central Bank of Nigeria (CBN) has made the federal government's position clear on the use of cryptocurrencies, declaring them illegal.

The central bank released a circular to the financial institution in the country, saying it will no longer deal in digital coins and will prohibit their exchange within the country. On February 5, 2018, Crypto ban in Nigeria was released by our dictionary. The Central Bank of Nigeria (CBN) released a statement directing banks within their network to stop facilitating crypto related transactions and desist from transacting with entities engaging in this type of transaction.

The statement also instructed all banks and financial institutions to close accounts of individuals or entities engaging in this type of transaction.

Way out for Nigerians investing on crypto is the Peer-to- Peer transactions. (P2P) check out my next article for more on this. Thank you for reading today's article.