With a weak currency and a high inflation, Nigerians adopt bitcoin and government declares war
While the government of Nigeria has been considering Bitcoin a plague for the national economy, for many Nigerians it is a form of protection. In early February, the country’s Central Bank determined that the country’s banks and financial institutions should identify and close the accounts of customers who trade in cryptocurrencies.
The measure resulted in the closure of local and international brokers, such as Binance, as they were left without access to banks. In addition, it is an attempt to prevent popular access to digital assets at a time of economic crisis in which the local currency, Naira, has been losing value. In practice, however, it is not so easy to make the decision work.
“Screw the Central Bank of Nigeria and the government. We will continue to buy and trade bitcoin and altcoins in the same way through P2P, ”blockchain entrepreneur and architect Charles Okaformbah told the Bitcoin Portal during a video call.
In P2P trades, a person transfers cryptocurrencies directly to another without the intermediation of an exchange.
Okaformbah, who lives in Lagos (Nigeria’s largest city) and has been working with distributed registration technologies since 2017, said Nigerians do not need brokers or companies. “We always find a way to buy and sell”.
The P2P scenario portrayed by the businessman – which was the one dreamed up by Satoshi Nakamoto when creating the Bitcoin network – can be seen in the numbers. According to data from the P2P Paxful and LocalBitcoin exchanges, compiled by Usefultulips, Nigeria is the third country in the world in terms of volume of negotiations between people, behind the United States and Russia.
In 2020, according to the tool, Nigerians traded $ 347 million in cryptocurrencies on the platforms, an increase of 20% over the previous year. In the USA, investors moved US $ 1.2 billion last year, while in Russia the total was around US $ 416 million.
At Paxful alone, according to data sent to the Bitcoin Portal, there are about 1 million Nigerians registered with the company, which represents one fifth of the total number of customers.
In addition to being on the agenda at the Central Bank of Nigeria, the discussion on cryptocurrencies also reached the country’s Senate earlier this month. Senator Sani Musa said that bitcoin is strong and made Naira “almost worthless or worthless”.