Nigeria’s interest in Bitcoin has waned as a result of the CBN’s actions and as thus, is no longer at the top of the list of countries with the highest interest in Bitcoin. Ranking top on the list now is El Salvador. Africa’s most powerful economy, Nigeria has fallen to the second position by a score of 61 while El Salvador took charge with a score of 100.
The drop in the interest of Bitcoin has to do with Nigeria’s central bank’s resolve in banning the grip Bitcoin has on Nigerians. A circular was issued by the bank’s Director of Banking Supervision, J.Y. Mamman, on the 3rd of November, 2021 which instructed banks to close down accounts of designated bank customers and suspend their funds in suspense accounts.
This latest circular reiterated an older one that was issued in 2017, warning banks not to deal in cryptocurrency and to ensure that their virtual currency exchange customers had anti-terrorist financing controls and effective anti-money laundering. These were to enable such customers to comply with KYC and transaction monitoring regulations.
Crypto experts have argued that Nigerian crypto traders to greater risks by pushing them out of the banking system and removing them from the global market that offers unequivocal returns and relative currency stability. It has become quite hard for a number of her citizens to trade crypto, as P2P sellers and buyers are now really difficult to locate. People will now try to conduct the transaction unofficially through other P2P methods.
Many informal P2P traders reportedly charge exorbitant rates, leaving a number of young Nigerians discouraged. Local lenders are no longer allowed to work with digital asset companies since the Nigerian central bank has banned cryptocurrency assets in Nigeria.
According to Chainalysis estimates, between July 2020 and June 2021, African countries received about $105.6 billion in cryptocurrency. In terms of volume, Nigeria played a big role to an extent. Nigeria still remains Africa’s largest cryptocurrency market.
One major reason Nigerians are attracted to Bitcoin is that, unlike traditional payment methods, there are no borders, this makes it effortless and really low in transaction fees.
Nigeria is one of the world’s youngest populations and the largest economy in Africa, as well as Africa’s most populous country. Nigeria is now Africa’s largest bitcoin trading market, by volume, this is all thanks to a thriving tech sector.