While the government ban has prevented all financial institutions and banks from facilitating any crypto transaction and also commanded that they shut down any account that involves in this kind of trade, crypto traders have found a way around this restriction.
This ban has somehow limited the operations of traditional/centralized exchanges which are one of the most common ways people buy BTC in Nigeria. On centralized exchanges, people buy bitcoin with Naira directly from their bank and according to the statement released, if you carry out such a transaction, your account will be flagged.
After the ban, Nigerians turned to P2P exchanges for their cryptocurrency transactions. So while the ban was supposed to limit the number of transactions carried out in the country and affect the growth of crypto, Nigerians now trade on P2P platforms like Huobi Global, Binance, Okex and other exchanges that offer P2P services.
On P2P platforms, you don’t buy BTC ( or other alts) with the Naira directly from the exchange but you buy from another person in the P2P section. The P2P exchange only serves as a marketplace to bring buyers and sellers together.
Rigorous Foreign exchange laws have been one of the factors that have aided the use and adoption of cryptocurrency in Nigeria despite the ban. A lot of people in the country have turned to bitcoin for foreign transactions. Taking advantage of the decentralized nature of the currency.
The ban does not affect the use of crypto for inter-border transfer so far it isn’t facilitated by a financial institution. Even before the ban, cross-border transactions have been one of the advantages of bitcoin over the naira and the ban has had little or no effect on it.
The Central Bank of Nigeria had set to launch its digital currency on the 1st of October 2021, even after shutting down crypto transactions in the country.
The e-naira which was set to be launched on October 1 but postponed indefinitely is a legal tender equal to the value of the naira and therefore must be accepted as a form of payment by all traders and business corporations in Nigeria.
In conclusion, there are some other reasons why crypto continues to thrive in Nigeria. A lot of Nigerians use bitcoin to hedge against inflation as naira continues to lose its value, so crypto traders and investors continue to find ways to buy bitcoin in Nigeria. However, the stance of Nigeria regarding crypto is still not solid.
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