Nigeria is in the process of adopting Bitcoin
Nigeria is one of the most active African countries in the cryptocurrency ecosystem. Investors are plentiful and the country is among those with the largest number of crypto platforms. Today, the country is in the process of legalizing the flagship digital asset.
Bitcoin as fiat currency
A local Nigerian newspaper reported that the chairman of the Capital Market and Institutions Committee of the House of Representatives in Nigeria, Babangida Ibrahim, is ready to pass a law making the use of Bitcoin and cryptocurrencies legal. The bill aims to recognize Bitcoin as legal investment capital. This means amending the Investments and Securities Act of 2007 e
In February 2021, Nigeria effectively banned the use of bitcoin with a letter banning regulated financial firms from “dealing” with cryptocurrencies. In the same year, Bitcoin Magazine reported that Nigeria achieved the highest peer-to-peer bitcoin trading volume in the world, and Chainanalysis reported that Nigeria has significantly accelerated bitcoin adoption.
The newspaper report describes how Ibrahim highlighted Nigeria's lagging behind in regulating cryptocurrencies, stating, “An efficient and vibrant capital market is needed in Nigeria as I mentioned in second reading. To do this, it is necessary to comply with current global practices.
If the proposed legislation adequately addresses the country's growing use of bitcoin, it could be a key catalyst for the country on the most populous African continent.
Bitcoin has a strong presence in the country despite the current ban. Nigeria has in fact started the construction of a bitcoin village. Additionally, the country has a large community of Bitcoin investors who are involved in all kinds of development projects.
A difficult start for eNaira
In October 2021, Nigeria became the first African country to launch a BCNDC, the eNaira. In April this year, in a document titled CBDC Global Index 2022 and based on a number of indicators, accounting firm PwC stated that eNaira is the most developed and best performing CBDC.
However, its adoption is not yet complete and therefore players salaries cannot yet be paid with digital currency! The latest information from the Central Bank of Nigeria (CBN) has revealed that around 270,000 eNaira wallets have been opened. This includes 252,000 investor portfolios and 17,000 trader portfolios.
In addition, the volume and value of transactions reached over $200,000 and eNaira 4 billion respectively. However, these figures may seem paltry. Indeed, the country has no less than 134 million active bank accounts for 211 million inhabitants.
A 180 degree turn
Nigeria had implicitly banned the use of cryptocurrencies. The government has asked financial institutions to close accounts suspected of having transacted in cryptocurrencies . The central bank justified its decision by explaining that it wanted to protect the financial system and citizens. He added that he will use any means necessary to dissuade Nigerians from using cryptocurrencies.
However, this does not appear to be holding back their adoption by Nigerian citizens, according to the Bitget exchange. In a paper entitled What Does the Future Hold for Crypto Exchanges, Nigeria is the second largest market for cryptocurrencies on the African continent. Before us is South Africa, much to the chagrin of the central bank and its CBDC.
As in many other countries where they are adopted, cryptocurrencies are mainly used as an alternative for the storage and transfer of assets. They are also a way to hedge against inflation.
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The article Nigeria is in the process of adopting Bitcoin comes from Scenari Economici .
This is a machine translation of a post published on Scenari Economici at the URL https://scenarieconomici.it/la-nigeria-e-in-procinto-di-adottare-il-bitcoin/ on Tue, 10 Jan 2023 05:00:12 +0000.