Cryptocurrency
1 Bitcoin will buy you a house in Nigeria’s rich suburb
The record gains posted by the world’s most popular crypto asset has surely endeared it to a growing number of Nigerians.
The world’s most popular crypto, Bitcoin, has printed gains of more than 833% in the past year, as investors troop in with bullish momentum, pushing the coin’s value near a $60,000 price level.
The flagship crypto, at the time of writing, is trading at $58,885.09 (approximately N28,264,843 at the exchange rate of N480 to $1). This amount would comfortably buy a Unit of 3-bedroom apartments in Abraham Adesanya Estate, Ajah Lagos, according to Propertypro.ng, a top real estate listing website in Nigeria.
This adds credence to why the level of interest in Bitcoin on Google search engine is higher in Nigeria than in any other part of the world. A significant number of Nigerian millennials use the flagship crypto-asset to preserve their wealth and save themselves from the long and arduous bureaucratic processes associated with opening a Nigerian investment account.
READ: Bitcoin produces 4 billionaires worth at least $3 billion each
Buying property with Bitcoin is fast gaining traction particularly in developed markets because transactions are done quicker than property purchases with fiat currencies; as there is no need for additional fees or intermediaries common with other means of payments like cash, and there are no transaction limits such as the daily transfers limits imposed by Nigerian Banks.
A growing number of individuals with meaningful Bitcoin assets often prefer to diversify their Crypto holdings to less risky and tangible assets like real estate.
In addition, Jesse Powell, the leader of Europe’s most powerful Crypto exchange, when responding to questions on Bloomberg said, “I think I said Bitcoin is going to infinity and that’s kind of hard to comprehend because I’m measuring it in terms of dollars.”
The highly respected Crypto leader also spoke on the futuristic price of the world’s most popular crypto:
“To the crypto community, I think those kinds of assets are easier to measure Bitcoin against because you never know where the dollar is going to be. There could be 10 times as many U.S. dollars out there a year from now, so it’s really hard to measure Bitcoin against the dollar.”
READ: Bill Gates says he doesn’t own Bitcoin, remains neutral about crypto
When Lambo? Probably by the end of the year, says @jespow.
The CEO and founder of #cryptocurrency exchange Kraken speaks to @emilychangtv and @sonalibasak on how high he thinks #Bitcoin can go https://t.co/yfkGwDPMBy
More on @crypto: https://t.co/NLRE84Up5T pic.twitter.com/55ya7epGtu
— Bloomberg Crypto (@crypto) March 31, 2021
READ: Number of Bitcoin millionaires worth at least $5.7 million hit one month low
Bottom line: The record gains posted by the world’s most popular crypto asset has surely endeared it to a growing number of Nigerians, particularly those seeking investment opportunities that preserve their earnings and hedge against Nigeria’s current galloping inflation.
Crypto pundits are, therefore, not surprised that Africa’s biggest and arguably most important crypto market is not giving up on bitcoin and is thus, ready to pay a premium to hold on to the asset, irrespective of the Central Bank’s ban.
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ABCON asks CBN to check impact of cryptocurrencies on diaspora remittances
The association also noted that the apex bank needs to address other issues driving the patronage of cryptocurrency exchanges for remittance transfers.
The Association of Bureau De Change Operators of Nigeria (ABCON) has asked the Central Bank of Nigeria (CBN) to introduce measures that will neutralize the positive effects of cryptocurrencies as a channel for diaspora remittances.
This is to redirect diaspora remittances away from cryptocurrency exchanges to official channels and also protect such against potential disruptions.
This call was made by ABCON during its Quarterly Economic Review for the first quarter of 2021 where it commended the CBN for the N5/$ rebate scheme introduced to encourage diaspora Nigerians to use official channels to remit their funds.
However, the association noted that the apex bank needs to address other issues driving the patronage of cryptocurrency exchanges for remittance transfers.
READ: Nigeria among worst countries to start a career, and they all don’t accept crypto
What ABCON is saying in their statement
The association in its statement said, “It is noteworthy that public acceptability for cryptocurrency exchanges are rising which could be quite accountable for the wide drop in diaspora inflows to Nigeria. Insecurity in the country is giving it greater prominence as investors and citizens are finding Cryptocurrency a safe haven for their wealth in case of any eventuality.
In most Emerging Markets Bitcoin transfers surged last year, as the pandemic exposed the cheaper and more efficient digital remittance services. Migrants sending money across borders to their families prefer the minimal transaction costs of cryptocurrency exchanges against the exorbitant costs of traditional money transfer companies like Western Union.”
READ: Atsu Davoh is building ways for Africans to easily acquire and spend cryptocurrency
According to ABCON, “Cryptocurrency transactions are faster than the conventional transfers, which require passing through banks reliant SWIFT, the sluggish, half-century-old interbank messaging system that handles cross-border payments.
These exchanges override the political complications of official channels. The global reach of cryptocurrencies avoids the inflation risk inherent to official currencies, especially in politically unstable countries reliant on fickle foreign investors.
Thus, while we commend the efforts of CBN in introducing the package of Five Naira for One Dollar transfer, it can be seen from the analysis above that the challenges exceed just non-payment of foreign currency by the IMTCs and the exchange rate. Strategies that satisfy the most sensitive of these advantages of Cryptocurrency exchanges must be introduced to redirect flows to the official channel.”
ABCON also expressed concerns over the country’s huge unemployment rate, urging the government to apply radical approaches with the use of both conventional and unconventional economic and political tools to redress the trend.
READ: Afreximbank President reveals ways Nigeria can boost diaspora participation in economy
What you should know
- It can be recalled that the apex bank had about 2 months ago, warned the Deposit Money Banks, Non-Financial Institutions and other Financial Institutions against doing business in crypto and other digital assets.
- The CBN directed financial institutions to immediately close the accounts of persons or entities transacting in or operating cryptocurrency exchanges, warning of severe regulatory sanctions in the event of any breach of the directive.
- The Securities and Exchange Commission (SEC) had a few days ago, revealed that it is working with the CBN for a better understanding and regulation of cryptocurrencies in the country.
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