An increasing number of people buy and sell Bitcoin in Nigeria. The cryptocurrency is used for different purposes to make people’s lives easier. More Nigerians than ever are using Bitcoin to make financial transactions and preserve their wealth.Â
Nigeria experiences millions of dollars in trading volumes a week. People trade over $4 million dollars of cryptocurrencies on a weekly basis in the region. If OTC trades are also taken into account, the figure for users of bitcoin in Nigeria could be much larger.
There are several reasons for the rise in use of Bitcoin in Nigeria:
• Wealth preservation
• Lower costs of transaction
• Flexibility
The design of Bitcoin makes it possible to avoid the high costs of inflation incurred by holders of fiat currency such as the Naira. By design, Bitcoin is deflationary. The supply of the cryptocurrency falls with time, due to the fixed number of Bitcoin that can be made. More holders of Bitcoin in Nigeria find that they can preserve their purchasing power by holding cryptocurrency. However, the volatility of the cryptocurrency remains a significant concern.
Nigerians usually experience high transaction costs and bank fees which reduces their ability to save or spend money on goods and services they would like to acquire. Bitcoin does not have as many associated costs as Nigerian banks. It offers different ways to reduce costs of transactions.
Nigerians buy and sell Bitcoin because of the flexibility it offers. Unlike more conventional methods of making financial transactions, Bitcoin offers users flexibility in terms of how easily they can set up accounts, how much they can transfer and when they can make transfers. As an example, a user of Bitcoin in Nigeria can easily transfer money across different geographic regions, both local and international much quicker than they could without an account.
Photo by Jordan Rowland on Unsplash
