If there is one place where cryptocurrencies are drawing much more attention than anywhere else right now, it is Nigeria. Africa’s largest economy is driven by its oil exports, the expansion of manufacturing, financial services, communications and information technology, but also by a tech-savvy generation that questions Google about Bitcoin more than its peers in other countries. Despite progress, however, cash remains the only option for many Nigerians to buy cryptocurrency. New services aim to meet this demand.
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Half of Nigeria’s population remains financially excluded
Nigeria accounts for almost a quarter of all Internet users in Africa. More than 123 million Nigerians have access to the Web according to the latest data from Internet World Stats, and one might think that using an online platform to acquire cryptocurrencies is not a problem for them . Indeed, the opportunities to buy bitcoin on the Internet have increased, as have the people who profit from it. The Nigeria Bitcoin Community portal lists a number of brokers and trading platforms available in the country, such as Quidax, Luno, Blockvila, Alphabits and P2P exchanges like Remitano, Localbitcoins, Paxful, Coindirect, Buy Coins and Coincola. Other options include Cryset, Redimit, Instantgold.
Buying cryptocurrency online, however, often requires the buyer to pay electronically, using “traditional” methods such as a bank transfer or credit card. And here’s the real problem – having internet access doesn’t mean having a bank account. Almost half of the 200 million Nigerians are unbanked and form a majority of almost two thirds with the category of underbanked. According to data released by the World Bank, only around 40% of Nigerian adults have an account with a financial institution or mobile money provider.
At the same time, the 2018 Global Findex report showed that almost one in 10 unbanked Nigerians receives their wages in cash, including four million people who have a mobile phone. Add to that 15 million unbanked Nigerian farmers who sell cash for agricultural products, 10 million of whom are also mobile phone users. It is a tremendous growth opportunity for cryptocurrencies that need a simple phone to “work”, and not even the Internet is absolutely necessary thanks to SMS wallets like Cointext, for example.
Millions of financially excluded Nigerians could potentially benefit from the financial freedom that accompanies decentralized digital money, if they could only obtain cryptography. Cash is everywhere in this part of the world and it is the universal means of payment to which the poor and disadvantaged have access. New opportunities to buy bitcoin with paper money have emerged in Nigeria in response to interest and demand.
Buy Bitcoin with vouchers paid in cash
Yellow Card is a platform that covers Nigerians knowledgeable about technology and the Internet, offering them the purchase of cryptocurrencies online using a bank transfer or ATM card to charge. their accounts with naira, then pay the digital coins they want. It currently supports bitcoin core and dash and will add bitcoin cash (BCH) and tether (USDT) in the near future, confirmed a representative of the company. However, people who only have money in their pockets are also encouraged to acquire cryptocurrencies at a yellow card store or one of the platform’s agents. To do this, they must purchase a yellow card voucher from a merchant who comes with a 16-digit code and redeem it in the mobile application.
Munachi Ogueke, CBO at Yellow Card Financial, told news.Bitcoin.com that although the main demand is still coming from traders with bank accounts that generally move larger volumes, the cash option is also doing well. Yellow Card is currently working with agents in and around Lagos, the country’s commercial and financial center, and the federal capital Abuja, but has serious plans to expand into the rest of the country to add thousands of brick stores. and mortar to its network. There are many different reasons for the increased demand for crypto in Nigeria, Ogueke commented, noting the country’s young population and great interest in the technology, among other factors. Noting that cryptocurrencies are also gradually becoming a popular money transfer tool for Nigerians living and working abroad, he said:
We are witnessing explosive growth.
Nigeria gets Bitcoin ATM and it won’t be the last
Other cash for cryptography options are also gaining ground. Nigeria now has at least one operational Bitcoin distributor. For a variety of reasons, including security concerns, there are only a few dozen ATMs supporting cryptocurrencies across Africa, shows the Coinatmradar card. According to local media, Nigeria only got its first BATM this year. The device was deployed to the Dazey Lounge & Bar in Lagos in early January by a local company called Blockstale. The ATM was made in China but has an “Africa-oriented design”, which takes into account the security problem in the country, with an alarm system, a remote tracker and biological scanners to make it anti-theft and anti-vandalism, as the Weetracker media reported.
Speaking to news.Bitcoin.com, managing director Daniel Adekunle revealed that Blockstale is preparing to install more cryptocurrency ATMs in Nigeria and neighboring countries. The company has already delivered five more machines which will be deployed in Lagos by the end of the month and which will then travel to Abuja in the next quarter. These are two-way devices that support BTC purchases and sales at the moment, but more currency will be added later. Blockstale is also considering the introduction of a mobile recharge functionality allowing users to recharge their prepaid mobile phones using cryptography. “Nigerians have trust issues, which means we prefer to have direct interactions because we think it’s safe, secure, and best practices to avoid loss of funds,” said Adekunle, adding:
We operate in a cash economy even if our banks don’t want us to use cash. These BATM serve as an access ramp for users who wish to withdraw their digital assets or have quick access to buy digital assets in cash safely.
Being able to buy cryptocurrencies directly in cash is undoubtedly a convenience for many Nigerians. But since the option is not yet widely available, there is another attractive alternative to checks and ATMs – gift cards. Hong Kong-based digital asset trading platform Coincola offers an OTC market for major cryptocurrencies, including BTC and BCH. In 2019, the exchange launched an active campaign to penetrate the Nigerian market and was very well accepted, according to the Nigerian Bitcoin community. In addition to making it easier to buy and sell cryptocurrency with the national fiat currency, the naira, the exchange maintains a gift card trading section where Nigerians can buy bitcoin with just about any card – gift you can imagine.
Do you think these new cash services will attract more Nigerians to Bitcoin? Share your expectations in the comments section below.
Warning: This article is for informational purposes only. It is neither an offer nor a solicitation of an offer to buy or sell, nor a recommendation, approval or sponsorship of products, services or companies. Bitcoin.com does not provide investment, tax, legal or accounting advice. Neither the company nor the author is responsible, directly or indirectly, for any damage or loss caused or supposed to be caused by or in connection with the use or dependence on the content, goods or services mentioned in this article.
Images courtesy of Shutterstock, Yellow Card, Blockstale.
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