From Facebook to Twitter, influencers, cryptocurrency traders and interested stakeholders have hinged CBN’s cryptocurrency ban on lack of knowledge of the blockchain technology or the crypto space.
Meanwhile, it was the peculiarities of the Nigerian economy that necessitate CBN’s intervention in the crypto space.
The CBN is looking to revive the economy, create new jobs, deepen productivities and generally broaden growth.
However, the amount of money flowing into the crypto space at the expense of Nigeria’s real sector is weighing on the nation’s economic recovery and disrupting CBN strategies.
Nigeria’s investors that are being forced to invest in the real sector suddenly started dumping money on cryptocurrencies due to the ongoing bullish run.
The CBN needs all help it can get to curb capital outflow and improve the economy, not build Bitcoin or other cryptocurrencies created by foreign entities.
Dollar scarcity and the continuous plunge in Naira value despite CBN efforts is partly because of scarcity created by firms like cryptocurrency exchanges that buys and sells dollar at black market rates.
They are part of the reasons the black market thrives despite efforts to curtail their activities. They create forex scarcity given the fact that they added to manufacturers and other importers struggling to access dollars in that section of the forex.
Also, the data that is coming from the crypto exchanges shows Nigeria’s crypto transaction volume is more than the equities market even with the equities market gaining 50.03 percent in 2020.
Busha said it recorded $219,208,193 in transaction volume in 2020 while BuyCoins did $141,395,605.75.
Bitsika that deals in cryptocurrency and payments said it processed a total of $39,953,115 in transactions.
Luno, Remitano, Binance, Paxful and others are yet to release their numbers. Meaning, crypto volume could more than double the Nigerian Stock Exchange trading volume for the year.
In fact, a report from UsefulTulips revealed that Nigerians transacted $32.3 million worth of Bitcoin in October 2020 alone. While Paxful has said Nigeria’s traded 60,215 Bitcoins worth over $566 million in the last five years on its platform, this excludes Ethereum and other cryptocurrencies.
According to Statista, “Nigeria’s interest in Bitcoins reached a peak during the summer of 2020, reaching the highest level since early 2018. This conclusion reveals itself after investigating Bitcoin trading volume against domestic currencies used for the transaction of the virtual currency. The African country was said to be one of the three countries with the most Bitcoin trading in the world in 2020.”
It indicates that without cryptocurrency trading investments in the real sector or the Nigerian Stock Exchange could have grown more.
It is the same with the real sector, as long as investors have options with better-projected returns they won’t care about the real sector.
People that are saying businesses will die, how many cryptocurrency exchange firms are in Nigeria? Less than 30, compared that to the millions of businesses dying because of bankruptcy and poor economic productivity. What about the rising unemployment rate due to weak industries?
Also, do not forget that cryptocurrency traders/investors do not pay taxes, therefore, FG generates nothing from it, yet it keeps hurting its strategies and economic productivity at large.
All these coupled with the fact that the crypto space is not regulated and a slight policy adjustment in the U.S or other top trading nations could plunge the entire industry into disaster and millions of Nigerians into poverty rank, are the reasons the CBN moves to curb its excesses.
Luno Hits 9M Customers Mark
One of the leading global cryptocurrency exchange companies, Luno celebrates hitting 9 million customer mark in over 40 countries.
Luno is a digital currency exchange facility that offers an exchange platform for customers to buy, sell and store digital currencies as well as pay for products and services using a cryptocurrency wallet.
The cryptocurrency exchange platform, Luno, saw remarkable growth with the addition of one million customers in less than five months.
Africa is one of Luno’s strongest markets with over 45 percent of the one million new customers added since June are based in Africa.
Marius Reitz, GM for Africa at Luno commented: “The average value of first deposits made by our million new customers is around USD32. Most new customers (83%) bought Bitcoin, while 27% bought Ethereum and 23% bought Ripple. Of the new customers, 35% are aged between 18 and 24, and gender splits align with trends in financial services – almost three quarters (65%) are male.”
Luno was founded in 2013 by Marcus Swanepoel, an ex-investment banker, and Timothy Stranex a software engineer who had previously worked with Google.
“As we hit the 9 million customer mark, it is a fitting symbol that Luno’s logo now adorns an iconic building in Cape Town’s unofficial financial district on the foreshore. Staff numbers have swelled to over 600 across the UK, South Africa, Malaysia, Indonesia, Nigeria, Australia and Singapore, and we are actively hiring over 60 specialists,” says Reitz.
Reitz affirmed that it took Luno five years to build a base for its first one million customers in 2017. “Luno’s growth has accelerated significantly since then. In the last year alone, we have added over 3.6 million new customers,” he says.
Luno was acquired last year by US-based DCG, the world’s largest blockchain investor and is targeting a billion customers by 2030.
Today’s Cryptocurrency Investors are Tomorrow’s Masters of the Metaverse
Cryptocurrency investors of today are likely to be the “masters of the metaverse”, which has the potential to change how we live, interact and do business, predicts the CEO of one of the world’s largest independent financial advisory, asset management and fintech organisations.
The prediction from Nigel Green, the CEO and founder of deVere Group, comes as Facebook announces plans to hire 10,000 people in the European Union to develop a so-called metaverse.
“The metaverse has the potential to help unlock access to new creative, social and economic opportunities,” the tech giant said in its blog.
The term ‘metaverse’ gives a virtual parallel to physical reality where a community of people can interact in the form of avatars. It refers to the merging of physical, augmented, and virtual reality in a shared online environment.
Mr Green says: “Facebook’s announcement once again underscores that the metaverse is not being seen by those-in-the-know as an ‘extension’ of the internet, but as its successor.
“It will become the entrance to almost all digital experiences and an integral part of most physical ones, meaning it will fundamentally change the way we live, interact with each other and do business.
“It will revolutionise economies, it will be the key to the creation of whole new generations of companies, and this is why the big tech firms are jumping in – no one wants to be left behind something so monumental.”
He continues: “The metaverse is being built and run on blockchains and decentralised applications, which is the same cutting-edge technology used by cryptocurrencies like Bitcoin and Ethereum.
“In addition, in the virtual worlds which will reshape how we spend our time and our money, financial transactions will, of course, have to be digital.
“This means that cryptocurrencies are likely to become the sole legal tender accepted in the metaverse.
“All of this is a huge advantage to anyone investing in crypto today. Prices of major cryptocurrencies are likely to soar enormously in the next few years. As such, those buying now will be taking advantage of the lower entry points.
“Their purchasing power within the digital space can be expected to be huge as a result: they will be the ones who are the Masters of the Metaverse.”
Everything is very much still in the early stages, and it might be another decade or so until the potential of the metaverse is fully realised.
But, concludes Nigel Green, there is a “massive advantage” for early adopters of new tech – “just ask Facebook boss Mark Zuckerberg” – as well as those who “invest earlier on in the currencies of the future.”
Bitcoin Near $60,000 Per Coin After Bloomberg Report Favour Bitcoin ETF
Bitcoin, the world’s most capitalised cryptocurrency, rallied near $60,000 per coin after a report by Bloomberg said bitcoin futures exchange-traded fund (ETF) will clear the U.S. Securities and Exchange Commission (SEC) late on Thursday.
Cryptocurrency’s most dominant coin rose to $59,961 per coin before pulling back to $59,258.38 at the time of writing.
The SEC is reviewing around 40 bitcoin ETF filings with multiple decision deadlines on futures-linked products hitting next week. According to Bloomberg, the regulator is expected to approve at least some of them, clearing the way for trading to begin.
The SEC does not need to take any formal action to approve the filings. Under federal law, applications can become effective if the SEC allows a mandated deadline to pass by without requesting changes or directing the aspiring issuer to pull the filing.
Bloomberg named applications by ProShares and Invesco as two proposals that may be allowed to launch under this law next week.
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