Here’s Why Nigerians are Risking Arrests and Scams to Trade Cryptocurrency?

In the recent past, Nigeria’s CBDC launch and its subsequent rise in use within a month have overshadowed the struggles that Nigerians are going through to trade cryptocurrencies. The Nigerian Central Bank launched digital Naira after some delays, but the motive was to curb the use of private cryptocurrencies such as Bitcoin and other altcoins.

eNaira has already proven to be a great success in terms of adoption as the number of wallet downloads crossed 500,000. 78,000 merchants from 160 countries have also enrolled for the use of CBDC and a total of $155,000 worth of eNaira has been transacted since launch. The CBDC launch has also successfully brought down Bitcoin trading volume in the region by one-fourth. However, several Nigerian traders are still risking police arrests and growing scams as it is the only livelihood they have, making profits on the crypto trade.

Adebayo Sulaimon, a crypto trader in the country was recently arrested for trading cryptocurrencies and was released on a $290 bond. But as soon as he returned from jail he started trading crypto assets again and explained why,

“There were no jobs, nothing to do. We had to look for (ways) to eat. I trade cryptocurrency and I use it to survive, not as a side hustle,”

Is Crypto Ban in Nigeria a Success?

The growing popularity of eNaira within a month of its launch and declining crypto trading numbers might indicate that the crypto ban imposed by the government has been successful. Nigeria is among the selected few countries which have decided to outright ban crypto use like China, Russia, and Turkey. The Nigerian government believes crypto can be used as a tool for money laundering, terrorism financing, and other illegal activities. However, Kunbi Ademola, a tech-focused lawyer in the country claimed that the ban has been ineffective and it has only pushed the crypto market underground.

“The ban has been ineffective,” said Kunbi Ademola, a lawyer focused on the tech industry, now based in Britain. “But it has exposed a lot more young people to fraud … (peer-to-peer) is not as secure as the direct exchanges that you could do before on the cryptocurrency exchanges.”

Many countries have tried to outright ban crypto use but on all those occasions, the ban has proven to be ineffective given the centralized nature.