Authorities in Nigeria have planned to invade cryptocurrency. Now, a few months later, their efforts are obviously not working. The nation is a prime example of how, despite the State's restrictive position, people turn into cryptos for a challenging economy.

In February, the Central Bank of Nigeria ordered banks to 'track users and/or collectives' that conducted cryptographical or cryptographic transactions and to 'ensure that these accounts are instantly closed.' But this prohibition in Nigeria didn't stop bitcoin. Instead, the crypto community turned to peers, or directly sent payments.

The USD quantity of cryptography received by consumers in Nigeria was steadily increasing in 2020 and 2021, which can partly be associated with the bull market this year, according to blockchain research company Chainalysis. The analytics firm said that in May Nigeria received crypto worth 2,4 billion dollars compared to 684 million dollars last December.

Datas collected by Usefultulips, a Bitcoin analytical provider, indicate the use of Bitcoin in peer-to-peer transactions by Nigeria outweighs across Africa in conjunction. For instance, its nearest P2P BTC rival, Kenya, was $84.3 million over the last 180 days. A total of $59.8 million was spent in Ghana.

According to a study by Nairametrics, in February the largest economy in Africa monitored another all-time high in crypto p2p trading, after 15 percent increase in crypto peer-to-peer (P2P) buying and selling.

Nigeria now has a stunning long-term volume of trading of $1.5 billion on Paxful, according to the Vanguard report. Paxful is one of the world's largest P2P crypto-trading platforms.

Nigeria transacted Bitcoins worth $ 99.1 million over the first quarter of 2021, as shown from UsefulTulips, a website that examines the global use of cryptocurrencies. This figure exceeds Bitcoin P2P transactions in Kenya over the entire 2020 period. Kenya is in second place with $38.4 million worth of Bitcoin P2P trading.

With P2P transaction values of $27.4 million and $25.8 million, Ghana and South Africa are ranked in third and fourth place respectively.

Throughout the crypto restriction established by the Nigerian Central Bank, many young Nigerians accept Bitcoin (BTC, 0.79 percent). Indeed, the peer-to-peer currency trading in Africa has grown to $204 million since early 2021 and the use of BTC ATMs has also increased.

Nigeria, in Paxful's P2P rankings, sits worldwide with China, the US, India and Kenya.

This is not surprising since Paxful's P2P trading platform had waves in the populous African nation. Techpoint Africa reported that in the past five years, Nigeria traded over $566 million in bitcoins, second in the US. Paxful had more than a million Nigerian accounts in 2020.

Interestingly, the African techpoint study concluded that there were three crypto-bushes, $219.2 million, $141.39 million, and $39.95 million, respectively, in exchange for Busha, BuyCoins and Bitsika. With a total of approximately $400,556,913 million, it's indeed reasonable to think that transfers may be greater than the volume of exchanges of other local exchanges.

It is surprising that in the middle of February 2021 the ban on cryptography by the Central Bank of Nigeria (CBN) had made no effort to reduce crypto activity volumes in the country. Crypto transactions appear to have significantly increased since that time.

Lets Have Some Quick Facts:

How many of Nigeria's crypto owners?

More than 62,000 people are estimated to have at least one type of cryptocurrency, or 3.3% of the overall population of Latvia.

Is the next hub for crypto owners in Nigeria?

As far as the number of people looking for "Bitcoin" and the "Crypto" keywords on Google, Nigeria is the world's number one country.

What is Africa's crypto-capital?

In 2020, Nigeria will lead Africa to peer loans with P2P weekly volumes of about $8 million, followed by South Africa and Kenya with a weekly increase of about $2 million. In a 2020 online data platform survey by Statista, 32% of participating Nigerians were using cryptocurrencies – the world's highest ratio.

Nigeria's Real Situation Now: 

Wealth Without Borders:

In March, 32 percent of respondents in Nigeria used crypto, according to a March survey by Statista. Nigeria was also ranked 8th in the cryptocurrency adoption report for 2020 in Chainalysis worldwide.

Crypto's interest rose last Fall when activists from the EndSARS movement in Nigeria used bitcoin to raise money, in protest against police brutality.

Economic factors also seem to stimulate acceptance.

By 2021, with the country's inflation rate at 18%, the Nigerian naira has been losing value. While US dollars in Nigeria may be difficult to obtain, Bitcoin is a proxy for the dollar, allowing people to protect themselves from inflation in naira. Duty US dollars are highly demanded and not many goods are available on the market since the bulk of the products Nigerians purchase are imports.

Frozen Accounts:

It was not openly hostile to cryptography by the Nigerian government, especially the Central Bank of Nigeria. Commenting on the controversial ban during a March public event, the Deputy Governor of the Central Bank Adamu Lamtek said that the regulator had never totally prohibited Nigerian crypto-currency activities; it only prohibited crypto-business banking services.

However, Nigeria's reality remains tough for some crypto companies on the ground.

As stated in a CEO Marcus Swanepoel's recent statement, Luno, a crypto wallet owned by the Digital Currency Group (also the parent company of CoinDesk), had frozen deposits and withdrawals as of February.

Even though the company succeeded in getting its bank accounts unfrozen in Nigeria in June, it still does not allow the users to relocate their Fiat funds, Swanepoel said, adding that "the company has increased regulatory lobbying" in order to solve the problem.

P2P Boom:

Nigeria is not the only country where crypto communities have found ways to circumvent government restrictions.

In February, Nigerians dispatched even more bank wires to purchase bitcoin after the Central Bank of Nigeria banned crypto-related bank transfers, according to Paxful's Youssef. Paxful is "on pace" with 23% more trades financed in Nigeria with bank transfers and 36% higher in volume, Youssef said.

According to Paxful, Nigeria is the biggest market with approximately 1.5 million users and trading volume of over $1.5 billion.

Conclusion:

It is part of a major regional trend in Nigeria. According to Damilola Odufuwa, spokesperson for Binance in Africa, Africa's P2P trading volumes have been wildly rising 386.93% since January. In the same four months, the number of users across the mainland grew 2.228.21 percent. Specific data on Nigeria have been refused by the company.