Bitcoin adoption in different countries worldwide is growing incredibly fast and one of the many nations that accept cryptocurrencies enthusiastically is Nigeria. Chainalysis’ 2020 Cryptocurrency Geography Report revealed that Nigeria ranked eight in terms of crypto adoption and usage rate among 154 countries included in the study.
This proves that the country has a significant share in the major uptick in global crypto adoption. But why is Bitcoin so mainstream in this African country? What are the possible reasons why a lot of people buy Bitcoin in Nigeria?
A look at Nigeria’s current economic position
Among the 54 countries in the world’s second-largest and most populous continent, Nigeria’s economy is the largest in Africa. In the first quarter of this year, Bloomberg’s report stated that Nigeria tops South Africa as the continent’s biggest economy, regardless of which naira rate is used.
Source: Bloomberg, IMF, national statistical offices
However, the odd blow of coronavirus (COVID-19) has dramatically affected the country’s economy. In June 2020, worldbank.org reported that Nigeria’s economy could contract by 3.2% this year. Alarmingly, if the situation worsens because of the pandemic, the economy could shrink even further.
In the second quarter of this year, remittances in Nigeria dropped to $3373.09 million from $5629.04 million in the first quarter. Reports mentioned that this lowest remittance rate was probably due to the severe effects of COVID-19 on Nigerians living and working abroad.
You might be wondering what these numbers and graphs have to do with Bitcoin’s towering adoption in Nigeria. Let’s take a look at BTC’s current adoption rate in the country.
The state of Bitcoin adoption in Nigeria
A report from nairametrics.com revealed that Nigeria had been the biggest source of Bitcoin trading volume in the continent. This is also among the reasons why it’s considered Africa’s largest crypto market and one of the world’s fastest-growing cryptocurrency markets. Let’s check out the country’s trading volume on Paxful.
Paxful Nigerian naira (NGN) Volume
In the graph above, we can see a slight decline in BTC’s trading volume using Nigerian naira (NGN). On the flip side, this trading volume of over $2.8 million still tops the rest of African countries. South Africa ranks after Nigeria with over $400,000, followed by Kenya with more than $700,000.
But BTC’s adoption isn’t only measured by its trading volume in the country. With the recent events in the country concerning government regulations, Nigerians used social media and Bitcoin as their defenses in their protest against corruption. They took advantage of Bitcoin’s useful features to raise funds for the movement.
A report from Coindesk also mentioned Nigeria’s predominantly young population, current position as a regional technology hub, concerns with sending remittances to the country, and inflationary fiat currency are among the key drivers of the rising crypto adoption rate in the country.
Why is Bitcoin so popular in Nigeria?
This unique digital money offers a myriad of opportunities for everyone and these include the following:
1. It offers income-generating opportunities for everyone
Bitcoin is known for being highly volatile. That’s why one of the most effective and popular ways of earning cash is through crypto trading. By buying and selling Bitcoin, Nigerian traders can make money from the margins they set in every trade offer.
This is exactly what Samuel, a 23-year-old student and member of the Paxful Peer Program, does for a living. Through the earnings he makes from trading, he’s able to pay for his college expenses and help his parents along the way.
“My main source of income on Paxful is trading. I buy BTC at a lower price and then sell at a higher price. Trading Bitcoin reduces the stress on my parents because I’m able to prepare either half or the entire amount of my tuition before the payment period arrives.”
Apart from making money for his tuition, Samuel also pays for other things he needs for school. “Through the profits I make from trading, I pay for my books, school projects and other materials I might need, house rent, food, and even subscriptions to keep me on the run.”
By engaging in Bitcoin trading in Nigeria, he’s helping his parents while making his way towards financial independence at a very young age.
2. It’s an efficient means of transferring money
Earlier, we learned that Nigeria’s economy is also experiencing the pandemic’s effects, including the changes in the country’s remittance rate. Interestingly, apart from Bitcoin’s highly volatile characteristic, it’s also very popular for facilitating cheaper, borderless, and nearly instantaneous money transfers.
That’s why Victor, our 20-year-old student Peer uses BTC to send money in and out of Nigerian borders.
“I started using BTC for remittance in the early days of October 2020 when I sent Bitcoin to Madrid, Spain. Considering the stress of exchanging NGN to EUR and the time it takes to process transactions, sending money with BTC through peer-to-peer (P2P) marketplaces like Paxful is the best option.”
3. It provides an alternative way to save money
The traditional means of saving money involves opening an account in banks or other financial institutions that offer the same services or putting bills and coins inside fragile piggy banks until they’re full—during our childhood days, at least.
For places struggling to access financial services or for people who don’t have the necessary documents required to open a bank account, completing simple monetary transactions or saving money in such institutions can be challenging.
With Bitcoin, all you’ll need is a smartphone connected to the Internet and a reputable digital wallet where you’ll send, receive, store, and track your BTC funds. There are crypto marketplaces that offer a free Bitcoin wallet, so you don’t have to worry about spending too much to get started.
Recently, a report from Coindesk featured a father who studied crypto and trading while working as a teacher. By exploring different opportunities in the crypto sphere, he was able to earn money and eventually open Bitcoin wallets for his wife and unborn daughter—say goodbye to lengthy processing times, age requirements, and other documents needed!
Bitcoin has a lot of exciting things to offer
Apart from what we’ve listed above, most Nigerians also see Bitcoin as an excellent vehicle that can take them to financial inclusion because of its capacity to provide cheaper, borderless, and almost instant financial services to everyone. It’s also accepted by many major businesses and institutions worldwide, which makes it more efficient and accessible to use. Some African investors also engage in Bitcoin investment in Nigeria to take advantage of the asset’s highly fluctuating value.
If you’re completely new to the crypto world and you’re wondering where to buy Bitcoin in Nigeria, you’re in the right place! On Paxful, you can choose from over 300 ways to buy and sell BTC and Tether (USDT), and pick the payment method that best suits your needs and trading style. As a gift, you’ll also receive a free Bitcoin wallet right after creating an account. It’s that easy. Sign up right away and start your trading adventure in Nigeria today!