Effects Of The Cryptocurrency Ban In Nigeria

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Do you know that Nigeria appears in the highest bitcoin market all over Africa having the second-highest bitcoin volume worldwide? For the last 4 years, the spurring growth of bitcoin in Nigeria has blown storms due to its skyrocketing profits and valuable help to escape poverty; says Bitcoin Equaliser.

 

However, not long ago the Central Bank of Nigeria imposed a ban on cryptocurrency in the entire country. They issued a public notice in which the government discussed the potential risks of these virtual currencies and how it has affected the country’s financial growth by the individuals making huge money from an independent source.

As a result, GON strictly announced the closing of bank accounts that are involved in any activity related to cryptocurrency. As well, any exchange service taking remittance charges for the cryptocurrency will also be kept under custody and charged high punishing costs. The actual public notice was released on 5 February 2021 but the press release delivered after 2 days on 7 February further cleared the significant reasons behind the prohibition on crypto use in the country.

The eye-opening effect of the ban on Nigeria was somehow predicted as the Nigerians had been deeply involved in the use of crypto and had ultimately realized the capability of this revolutionary digital asset.

With that said, here is a compilation of different reactions of locals and other people on this crypto ban and how they cope up with this issue.

The inflation rate in Nigeria has always held the country back from progression and investments. Nigeria was already struggling with the declining oil prices that increased the inflation rate up to 16% there. In this regard, Nigerians were extremely worried as cryptocurrency was a major help to exchange their export costs to other foreign currency during the oil trading.

Read also: Ortom: Nigeria currently insecure; no one should talk of 2023

The volatile currency Naira was also a major concern for Nigerians as the CBN there had been consistently devaluing Naira which made it worthless to spend internationally for buying goods and services. Hence, the country found an easy alternative of using crypto rather than their country’s traditional currency Naira which was soon to be collapsed. However, the ban limited the crypto transactions into foreign countries by 97% which created tension within the county.

The staggering growth of cryptocurrency in Nigeriareached up to 25% that meets $566 million in the last five years. A number of Nigerians had risked all their assets into buying these cryptocurrencies and were now totally dependent on them to earn a living.

Surprisingly, Nigeria is also known to be the world’s second-largest peer-to-peer network with a myriad of trading exchanges carried out daily. All these factors highly disturbed the financial state of Investors who already had their money invested or were looking to invest in crypto for rapid profits and success. 

Rule for Trading Cryptocurrency in Nigeria.

Blockchain is a revolutionary decentralized technology invention that has solved 90% of our financial problems alone by its safe, efficient, and advanced working system. It is driving the whole world crazy today and has acquired immense recognition but unfortunately, the Nigerian government is still very reluctant to accept the use of crypto because of its past terrible experiences and mistakes.

The extensive use of crypto in Nigeria brought an under developing country really close to the huge digital transformation that every country desires for. Apart from all the efforts GON made for this goal, they were still unable to believe how a volatile, risky, and virtual currency can be a source of income and store of value for millions of Nigerians.

Conclusion: To simply put, this counteractive ban of cryptocurrency in Nigeria influenced the whole country including the individual investors and huge service providers. Neither Nigerians are allowed to mine crypto or trade it from any platform due to the transparency of cryptocurrency. All this caused numerous protests in the country by the name of #End SAARS. 

 

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