Bitcoin soars by over 60% in Nigeria
Bitcoin has experienced a soaring demand as the government encouraged its citizens to consider digital cash. An increase in demand in Nigeria made its price higher than the global market.
At the time of writing, the price of one Bitcoin on NairaEX, Nigerials crypto exchange, is 17.3 million, an equivalent of $38K. This equates to over 60% of the current price of Bitcoin.
The government has put limits to cash withdrawals in banks to encourage the move to be cashless. The official announcement was made in December. By the second week of January, Nigerians could withdraw a maximum of 20K Naira($44) in an atm per day and a weekly limit of 100K Naira($215). At the same time, the central bank of Nigeria launched new notes, which Nigerians had to exchange. Apart from encouraging a cashless generation, the move also aimed to limit money laundering and curb inflation. At the time, inflation was high at 21.34%.
Nigerians were given three weeks to exchange their old cash for new ones, with a deadline of Jan 24. The time was, however, not feasible as there were long queues with many complaints. This made them push the deadline to Feb 10.
Nigeria is a prime market for cryptocurrency. In February 2021, bitcoin soared by 36% following a ban in regulated financial institutions to stop offering services to crypto exchanges. This made account holders who deal with cryptocurrencies have their accounts closed. However, the situation changed as Nigeria passed a law recognizing bitcoin and digital assets as investment capital in a few months. This garnered much interest, with many considering using it to diversify their capital and investments.
Before that, the country had implemented a Central bank Digital Currency (CBDC), the e-naira. It faced a low adoption as people were skeptical of it.
Nigeria is working on a partnership with Binance to educate, support, and develop crypto and blockchain businesses in the region.
According to Google Trends, the current bitcoin situation in Nigeria has made it one of the leading countries for Bitcoin web searches.