Since the Bitcoin boom in 2017, it has become a commonly heard mantra that “Bitcoin is making people richer.” The growth of the cryptocurrency has enabled unbanked Nigerians to break free from the grip of high fees and exchange control, and it has also attracted the attention of investors and businesses around the world. But this growth has not been without its challenges.
The year is 2016 and the world is a different place than it used to be. In this digital age, where more and more of our interactions are occurring in the digital realm, the firm belief in a non-digital world has started to become less and less compelling. In the aftermath of the global financial crisis, a greater emphasis has been placed on the role of digital assets in the global economy, and the role of digital technology has grown in importance as a result.Nigeria has 211 million people and only 50% of them have a bank account. In January 2021, the internet penetration rate in Nigeria was 50% and only 10-20% of the total population use smartphones. The value of the currency, the naira, has also fallen by 7.6% against the dollar and the inflation rate is now 15%. The government wanted to limit inflation to 2%, but it is now rising at 3.4%. So why does all this matter? These economic data are more than sufficient to illustrate that the world lives in two different configurations. People in developed countries often take identification, flexible payment systems and fast internet connections for granted. You can make payments in seconds and don’t have to pay 8-15% transaction fees. If it’s a developing country, it’s hard to globalize something new for the masses. In countries like Nigeria, there is no problem with race or religion; the problem is the system the people live in. It is fundamentally broken, and no amount of improvement will fix it. And then along comes bitcoin, which makes things better for ordinary citizens. Nigeria is one of the largest markets in the world in terms of adoption, usage and trade volume. While the world is in an uproar over crypto-mines, Elon Musk’s tweets and other trends in the crypto-currency market, bitcoin is changing lives here in Nigeria. In this article, we will look at all the important aspects of the mass adoption of bitcoin in Nigeria and help you understand how bitcoin is helping the country emerge from the financial crisis.
Financial crisis in Nigeria – how serious is the situation?
The public banking system in African countries like Nigeria has always had difficulties in providing the population with means of exchange. They are unable to connect the unaffiliated and transfer those without bank accounts, but even that is not the biggest problem for the citizens of the country. Corruption is one of the main problems causing economic instability in the country. According to a report by PriceWaterhouseCoopers, Nigeria could lose 37% of its GDP to illegal corrupt activities. Moreover, the country was hit hard by Covid-19, which led to a prolonged exchange rate crisis. In order to keep the European oil markets under control, the government has been forced to make significant discounts and at one point even to sell at negative prices. High remittance fees remain a major problem in Nigeria and no traditional bank offers adequate support and assistance for online remittances. Finding an approved company to obtain international money is still difficult for a large portion of the population. Exchange rates have now simply become unmanageable as the dollar shortage continues to devalue the Naira.
Factors contributing to the mass acceptance of Bitcoin
The economic revolution currently taking place in African countries like Nigeria is 100% due to the rise of cryptocurrencies. People are fed up with outdated economic policies and trading with banks, so they are looking for other affordable options like bitcoin. But how did they become world leaders in Bitcoin adoption and use? We’ll see about that! Growth in remittances People living in first world countries are not aware that a large part of the income of many African countries, such as. B. Nigeria, comes from remittances sent abroad by the diaspora. The Bitcoin revolution has given people hope that they can get their hard-earned money without having to pay a large tax or fee for it. To see how popular bitcoin is in Nigeria, check out the chart below: International money inflows have dropped significantly over the past three years, all thanks to the widespread use of virtual currencies. People avoid the 9% transfer fees by using a bitcoin transfer company. Here’s a chart that will give you an idea of how quickly people are switching to bitcoin transfers: Source – Reuters Devaluation of the currency That’s not surprising. Countries like Nigeria are struggling with extreme inflation that is giving the common man the worst economic nightmares. In just one year, the Central Bank of Nigeria devalued the naira by 24% and citizens were asked to find alternative sources of income. That is why the Nigerian people have turned to bitcoin payment options and decided to take control of what is theirs. A recent study by Statista shows that the majority of Nigerians own or trade cryptocurrencies such as bitcoin. For people in countries like Nigeria, bitcoin is a ray of hope to create and maintain wealth and not fall victim to political instability and hyperinflation. determination of rules In Nigeria, regulators are openly taking a stand for cryptocurrencies and are willing to work with payment companies. A framework document was published in 2020 outlining all the policies and how the regulations will be implemented across the country. The approval of bitcoin by the U.S. Securities and Exchange Commission is a shot in the arm, as it opens up several opportunities for companies to collaborate on a level playing field and offer better products to their citizens. Although they said nothing about writing a new law or declaring bitcoin a new asset class, it makes a big difference to the citizens of the country because there is more security when using the bitcoin payment platform.
So why is bitcoin being suppressed lately?
It is not surprising that the Nigerian government is going after bitcoin for no good reason, as the money coming into the country is in the form of bitcoin, which indirectly puts a huge strain on traditional banks. The 5th. In February, the CBN issued a statement ordering banks to stop trading all cryptocurrency assets. While they stressed that this was not a ban on bitcoin, the decision had a major impact on the market. People couldn’t make deposits. Cryptocurrency exchanges like Binance and social payment apps suddenly stopped working. The solution? Moving to a P2P platform This is what Nigerian citizens have done and they are encouraging others to do the same. Traditional banking systems can do whatever they want with your bank account, but no one can hack or steal the money in your bitcoin wallet. Many blockchain experts and entrepreneurs in the field have expressed their opinions and pointed out that the CBN made a mistake by sending out the controversial memorandum. The fact that the CBN sent the controversial memo to banks and other financial institutions without giving industry participants and stakeholders a chance to engage in dialogue shows how little they know about the Nigerian blockchain and cryptocurrency ecosystem, Chuta said. After the CBN incident, P2P trading volume increased by nearly $100 million in 90 days. Paxful, a global peer-to-peer trading platform for cryptocurrencies, has recorded $1.5 billion in trading volume despite news of a possible ban. People outside Nigeria might think that the government’s crackdown on bitcoin scares the community at large. Still, this only confirms that there is nothing the traditional banking system can do to stop the use of bitcoin by the country’s citizens.
Bitcoin will change the future of Nigeria – here’s what we’re not telling you
You might think that bitcoin is the only innovation that is being used on such a large scale in Nigeria, but that’s not the case: the country is also leading the way in terms of mass use of technology. Most surprisingly, they are adopting new technologies at a rapid pace, while other developing countries are not yet ready to follow. Nigeria will be the leader of this bitcoin revolution, and this is largely due to the country’s youth. Many blockchain experts and analysts who have visited Nigeria for research purposes have consistently noted how quickly the younger generation is embracing all new technological developments. Many visionaries like Jack Dorsey are trying to do their part in the successful adoption of bitcoin in Nigeria. Even if there is no support anywhere, we see many young Nigerians finding alternative ways to buy or sell cryptocurrencies. The government is scared and trying to intimidate its citizens, but it won’t work. No news can destabilize Nigerians because they are all focused on one goal, economic freedom. Read the following quote and you will understand how powerful bitcoin has become. In January 2020, Nigeria’s foreign exchange imports stood at 2.5 billion, up from 55 million in September. There was a 98.7 percent drop in foreign money inflows, but a 98.7 percent increase in the use of bitcoin as a crypto currency, Ray Youssef said at the Bitcoin Miami 2021 conference. The data for this year is not yet available, so it will be higher in all respects. There is nothing the Nigerian government can do when there is such a drop in foreign money. They are trying to get rid of some investors by making contradictory statements. In the end bitcoin isn’t going anywhere, it will only get better and prove government agencies how flawed their system is.
Top 3 cryptocurrency exchanges in Nigeria
Patricia Patricia serves more than 300,000 people daily and is known for its financial infrastructure, digital payment solutions and global e-commerce. It is a reliable platform for Nigerians to buy/sell bitcoins of any value. You can even use this exchange to send gift cards. It also supports multiple assets, making it easy to move from one stage to the next. Luno Luno is a cross-platform crypto-currency exchange that supports the web, iOS and Android. The company was founded in 2013 and has since seen $21 billion in processed transactions and over 5 million downloads on the Play Store. The app also allows users to bet on cryptocurrencies and earn up to 7.6% per year. There is also no commission for Operation Maker. Buying coins in Africa Immediate exchange and no transaction fees are the two main features that set Buycoins Africa apart from others. A few reviewers also point out that they offer excellent customer service, with no wait times. Users also have the option to lock their savings into cryptocurrencies and earn an annual interest rate of 12%.
Should the Nigerian government adopt a bitcoin standard?
Without Bitcoin, Nigeria will not be able to rise up and achieve economic independence. That’s just not possible in the current economic situation in the country. In a letter recently written by Russell Okung, he makes it clear that the government urgently needs to adopt a Bitcoin standard and help reform the economy. Russell also says that the government doesn’t need to make a deal with a company for Bitcoin to have an impact on all of humanity, but it does need to provide national resources to facilitate the move to the next level. With a limited supply of bitcoins, it’s important to speed up the process. Other countries such as China and Iran are involved in many activities such as mining, so it is crucial not to be left behind. In his letter, Mr. Russell notes that this is a unique opportunity for global recognition. He cited the example of El Salvador and hoped Nigeria would lead the way in the next global financial movement. If we look at the government’s implementation plan, we see that it still has many unfinished blockchain attributes. The applications of blockchain are limitless. This can lead to a cashless economy and improve the financial literacy of citizens. The climb may take time, but it starts with the first step you take. The first step for Nigeria would be to adopt bitcoin as the standard.
People think Nigeria is notorious and full of scammers, but it is actually one of the fastest growing countries in the world. With young people taking center stage and embracing cryptocurrency payments, it’s easy for the country to adapt and evolve with bitcoin. Nigeria’s economy will survive if mass adoption continues to increase, otherwise inflation will increasingly trouble the common man. It’s going to take a while. It will take a concerted effort to achieve this, but at the current rate, Nigeria could be the first success story we can read about in the history books. Kartikeya Gutta, born and raised in India, is a cryptocurrency journalist and freelance writer for the website itsBlockchain. It covers various aspects of the industry through in-depth analysis and research. His passion for blockchain and the crypto-ecosystem is largely because he believes it can truly change the world and help millions of people.
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