In the verdant plains of Sub-Saharan Africa, Nigeria stands as a crypto colossus, defying the Central Bank’s frosty embrace of digital gold. A staggering $59 billion worth of crypto capers were recorded from July’s bloom to June’s dusk, nearly snatching half of the region’s estimated $125 billion. KPMG Nigeria, in cahoots with the blockchain whisperers at Chainalysis, have spun this astonishing tale.
Alas, the Central Bank of Nigeria (CBN), in a fit of digital xenophobia, banned the crypto kin from mingling with the banking gentry in 2021. But Nigerians, ever the resourceful lot, simply swapped the banking ballroom for the peer-to-peer (P2P) bazaar, keeping the crypto carousel spinning.
The report, Crypto Risk and Opportunities in Nigeria: A New Banking Paradigm, reveals that Nigerians are not merely speculating in crypto; they’re using it to buy their morning bread and evening tea. A whopping 85% of transactions were a pittance under $1 million, suggesting crypto is the new coin for the common man’s commerce.
Nigeria’s crypto market has been as volatile as a politician’s promise. In 2021, transactions were worth $47 billion, only to wobble slightly over the next two years. But by 2024, they roared back with a 25% surge, partly because the naira’s value is dropping faster than a politician’s credibility. Crypto, it seems, is the new safe haven.
Initially, the Nigerian government was as strict as a Victorian governess. In 2022, the CBN doled out a hefty N1.31 billion fine to six banks for their crypto dalliances. But by December 2023, the government had a change of heart, perhaps realizing that crypto is here to stay, like a stubborn rash.
The CBN now allows banks to frolic with licensed crypto companies, while the Nigerian Securities and Exchange Commission (SEC) sharpens its pencils, ready to tax and regulate. Safety and control, they say, are the new watchwords.
Crypto’s popularity in Nigeria is also due to its cost-effectiveness in sending money abroad. Many Nigerians, scattered like seeds in the wind, use crypto to send funds home, avoiding the traditional methods’ exorbitant fees.
“The high costs of cross-border transactions via traditional finance channels may have driven Nigerians to crypto,” the report muses, as if stating the obvious.
But where there’s money, there are scammers. In 2024 alone, they minted around $10 billion, proving that where there’s a crypto, there’s a way. Experts recommend banks use blockchain analytics, perhaps to catch these digital bandits.
Despite the hurdles, crypto in Nigeria is as unstoppable as a charging bull. Restrictions are but hurdles to be jumped, and as the government gropes for regulation, the future of crypto in Nigeria is as uncertain as it is inevitable. 🚀
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2025-03-20 21:57