Cryptocurrency Trading In Nigeria- Legal or Not
Cryptocurrency Trading In Nigeria
What Is Cryptocurrency?
Cryptocurrency Trading In Nigeria: Cryptocurrency or crypto, as it’s usually called, is a digital currency in which transactions are verified and secured through the use of cryptography.
They are otherwise known as digital money, rather than the physical ones like the USD, naira, and even Pounds. This means that they cannot be held or seen. The major characteristic of cryptocurrency is its decentralized nature, which means that it operates independently of any central authority. Transactions can then be done without the need for intermediaries such as banks.
The first and most well-known Cryptocurrency is Bitcoin, and this was what ushered in the era of crypto actually. There are others such as Ethereum, Litecoin, Ripple, and so on.
Another major attribute of Cryptocurrency is its volatility. The value of cryptocurrencies is not stable and can be highly volatile since its value is determined by supply and demand in the market
Cryptocurrencies are majorly stored in digital wallets since they are digital currencies. They can also be exchanged or traded for traditional/physical currencies such as USD, Naira, etc.
Recently, Cryptocurrency has been widely adopted such that it can be used to purchase goods and services from businesses that accept them as payment.
State of Cryptocurrency Trading in Nigeria
Nigeria is said to be a very crypto-curious country. Cryptocurrency trading has gained a lot of popularity over the years in Nigeria. A lot of the youths have taken it upon themselves to figure out what the movement is about. In fact, quite a lot of businesses started accepting crypto.
But this era was short-lived. The Nigerian government decided to ban crypto!
Why Was Crypto Banned In Nigeria?
Everybody recognized the potential of Cryptocurrency in Nigeria, and some people weren’t quite happy with it. The Nigerian government then decided to take steps to regulate the industry.
In February 2021, the Central Bank of Nigeria (CBN) issued a directive prohibiting financial institutions from dealing in cryptocurrencies or facilitating payments for crypto exchanges.
The reason given by the CBN was that cryptocurrencies would eventually pose a lot of risk to the country’s financial system, which includes money laundering, terrorism financing, and other criminal activities.They said that because crypto transactions were anonymous, they will be a useful tool for criminal activities. Let’s be honest, the government was a little shaken during the EndSARS protest, which got a lot of crypto donations and funding.
Another reason they gave was that cryptocurrencies are not backed by any tangible asset, making them too volatile and risky to invest in.
Consequences Of Cryptocurrency Trading in Nigeria
The CBN directive was met with so much criticism from the general public and the crypto industry. This directive did not make crypto illegal in Nigeria, because there are no laws or legal provisions criminalizing the use of cryptocurrencies. In fact, we can see that cryptocurrencies are still widely traded, even more than before on crypto exchanges in Nigeria. The ban simply means that cryptocurrency will not be attributed to the country’s banking and finance sector.
This is why we see an increase in the peer-to-peer market in the industry i.e P2P trading. P2P trading is the exchange or trading of cryptocurrencies between two anonymous people.
The ban still exists, but it doesn’t stop Nigerians from engaging in P2P trading on popular crypto exchanges
A New Way of Trading Crypto in Nigeria
These crypto exchanges are not without their risks and now, due to constant innovation, there is a better alternative to using regular crypto exchanges to trade your cryptocurrencies in Nigeria. Using reputable exchanges like Dtunes to trade your crypto assets.
WHY DTUNES?
- Dtunes is a very safe, fast, and reliable platform.
- Payment is immediate.
- For a seamless experience, we have a mobile app that has a user-friendly interface
- Our rates are the best. Ask around.
In conclusion, the state of cryptocurrency trading in Nigeria is dynamic and evolving, with ongoing regulatory developments and a growing interest from the public in the use of cryptocurrencies.
