Virtual currency is the money of the future and Nigerians are increasingly embracing the digital money lifestyle. Something which started out with a reluctant and slow adoption is gradually gaining strong demand.
Although, Nigeria’s government had threatened to issue sanctions against banks that process or got involved in Bitcoin, OneCoin or any other virtual currency.
But cryptocurrency dealers are springing up here and there nowadays. A mass of unemployed Nigerian youths are venturing into agency and distribution of Bitcoins, WebMoney, among other types of cryptocurrencies.
More investors are putting their money into cryptocurrency exchange businesses and consumers are also showing growing interest in virtual currencies.
Some have associated this sudden surge of interest and acceptance for cryptocurrencies in Nigeria to the action by Central Bank of Nigeria (CBN) to stop the outflow of foreign currencies.
Statistics prepared by localbitcoins.com reveal that Nigeria’s weekly Bitcoin exchange volumes since mid-December 2016 has increased from more than ₦400 million ($1.3 million) to over ₦1 billion ($3 million).
But, globally, things may not continue pleasantly for cryptocurrency, as holders of virtual currencies might lose all their money, according to a UK-based financial regulator.
Andrew Bailey, head of the Financial Conduct Authority (FCA), warns seriously against the impending risk awaiting virtual currencies.
Bailey told journalists that:
‘It’s not a currency, it’s actually not regulated in its Bitcoin form. It’s a very volatile commodity in terms of its pricing.
If you look at what has happened this year, I would caution people. We know relatively little about what informs the price of Bitcoin.
It’s an odd commodity as well, as the supply is fixed. If you want to invest in Bitcoin be prepared to lose your money – that would be my serious warning.’
There is also no clear regulatory position on digital currencies in Nigeria as well. But this does not mean digital currencies are illegal in the country, it only means that investors and consumers need to be cautious about their craze for such currencies.
Government has to step in to provide regulations for both individuals and businesses participating in the use and trade of digital currencies. It must also revise existing regulations that are relevant to financial systems and transactions within the country, like the Money Laundering Act.
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