Nigeria’s crypto transactions rose in value by 9% year-over-year, surging to a total of $56.7 billion from July 2022 and June this year.
A report published by the New York-based blockchain research firm, Chainalysis, reflected that the adoption of cryptocurrencies in Nigeria is on the rise, despite the fiscal, monetary and socioeconomic whirlwinds in the nation’s economic landscape.
Chainalysis reported that in Nigeria, the interest in Bitcoin and Stablecoins, which are crypto tokens anchored to stable assets to mitigate extreme price fluctuations, significantly surged following the lingering depreciation of the nation’s currency – Naira.
According to the firm, the depreciation in the value of the Naira became more pronounced in June and July this year as the aftermath of the President Bola Tinubu’s implementation of fiscal and monetary reforms, especially the fuel subsidy removal and foreign exchange (FX) rate restrictions.
Commenting on the rising cryptocurrencies adoption in the country and the Chainalysis’ report, co-founder of the Nigeria-based cryptocurrency exchange Busha, Moyo Sodipo, said: “People are constantly looking for opportunities to hedge against the devaluation of the naira and the persistent economic decline since COVID.”
It would be recalled that the Central Bank of Nigeria (CBN) had previously imposed restrictions, barring deposit money banks and other financial institutions from engaging in or facilitating cryptocurrency transactions in 2021.
However, in 2022 the apex bank introduced a set of regulations about digital assets as part of its efforts to navigate a middle path between an outright ban on crypto assets and their unregulated use.
The report stated that Nigeria’s tech-savvy, youthful population was majorly catalyzing the cryptocurrencies’ transactions leveraging peer-to-peer trading on crypto exchanges to avoid the restrictions imposed by the financial system’s regulators.
The report indicated that Uganda’s crypto transactions value also remarkably surged by 245% to$1.6 billion despite the small size of the nation’s economy during the period under review.
However, Chainalysis noted that crypto transactions in Kenya significantly declined by over 50%, ebbing to $8.4 billion between July last year and June this year.
