Nigerians don’t back down easily, especially concerning cryptocurrency.
According to data from Usefultulips (a Bitcoin analytic data provider) the usage of Bitcoin’s peer to peer trading in Nigeria surged by 27% since the Central Bank of Nigeria (CBN) banned cryptocurrency trading about 85 days ago. Nigerians moved about $103 million worth of Bitcoins on just Paxful and LocalBitcoins channels alone.
Why so popular?
The bull run: The price of bitcoin has risen by almost 500% since its latest bull run began at the start of Q4 2020, hitting record highs of almost $65,000 this month before pulling back to $55,000 as at yesterday evening. Few assets promise such high returns within a short time.
Couple this fact with Nigeria’s relatively young educated population, its growing internet adoption and smartphone penetration, Bitcoin is seen as a safe haven amidst the rising inflation that has eroded the savings of many Nigerians.
Low transaction costs: Compared to traditional banking channels, the borderless feature of Bitcoin makes payment effortless for Nigerians at an outrageously low cost. For example, many Nigerian banks charge 1–2.5%. For a $1 million offshore transfer, bank charges may go up to $10,000, but with Bitcoin, a similar transfer would not exceed $300, even at peak periods.
Read more: Nigerians increasingly using Bitcoin since CBN's Crypto ban