In the wake of police brutality in Nigeria, #EndSARS activists went for Bitcoin to fund their operations. And amidst the melee that ensued, the government banned Bitcoin and cryptocurrency exchanges.
The announcement was made through a directive issued by the Central Bank of Nigeria in February 2021, ordering all financial institutions to shut down any involvement with cryptocurrencies.
Apparently, a human rights organization, ‘The Feminist Coalition’ that champions for equal opportunity rights of Women, deployed aid to populations affected by police brutality earlier in the year.
The organization’s main focus was to support and amass medicare, legal aid, and fundraise for funerals for participants of the AntiSars campaign.
Within days, The Feminist Coalition had collected an estimated $185,000 and backed at least 128 protests taking place in Nigeria.
What followed was a panorama of government involvement in censoring the fundraising activities, and all financial accounts associated with human rights groups were shut down. Flutterwave, a popular payment processing platform in West Africa, shut down the processing of donations. And a section of tech-savvy members of the Feminist Coalition turned to the liberal feature of Bitcoin to help raise more funds.
The government made its final move by banning all cryptocurrency trading activities and all digital currency exchanges. On the following day after the ban, Binance delisted the Naira from its supported currencies.
It’s been three months since the outlawing of crypto and crypto exchanges in the West African country. The Central Bank of Nigeria defines crypto as a menace that’s both risky and supports criminal activities. In the directive, CBN provided a list of potential risks, namely, funding of terrorism, illicit payments, money laundering, and the potential to support anti-government campaigns. While several sources contradict the Central Bank’s stand, Nigerian crypto-savvy citizens have sought alternative methods of trading Bitcoins.
And one of them is trading cryptocurrencies through local peer-to-peer (P2P) exchanges. It’s worth noting CBN’s ban came at a time when cryptocurrency trading volumes were hitting spectacular numbers across the digital currency market. In fact, Nigeria was the 2nd leading cryptocurrency market by trading volume after the United States. According to estimates, Nigerians have traded over $600 million since 2016.
Despite the ban, Nigerians still find a source of livelihood in the crypto-verse, and their trading volumes have not deteriorated. Two days ago, a study by UsefulTulips reported Nigerian trades on Paxful had hit a record $1.5 billion.
For example, data from Coin. Dance revealed that weekly trading volumes on Local. Bitcoins (a P2P crypto exchange) haven’t slowed down. This week’s traded volume on LocalBitcoins was a record $2.6 million.
(Source: Coindance)
A section of traders is even taking risky investments when trading crypto. In particular, those trading through chat applications such as Messenger, Whatsapp, and Telegram. Young Nigerian Netizens are still hopeful the Central Bank of Nigeria will reconsider its decision and lift the ban.