Africa has undoubtedly been a major crypto asset exchange battlefield. South Africa is hailed as a pioneer in digital crypto adoption. Still, in recent months, Nigeria has become the hub of African crypto usage.
Social distancing measures to contain the Covid-19 outbreak during the linked shutdown. This has upset the global economy, causing some African nations’ economies to falter. As a result of the viral epidemic, Nigeria’s dependency on crude oil has witnessed a worldwide oil crisis.
This has led to a weak currency and employment losses. This is one among the reasons why so many Nigerian youngsters are combining crypto trading with fighting the global Covid-19 pandemic. However, the Nigerian government sees the need to regulate the industries. According to recent reports, the Nigerian government saw the potentials of the rising number of Nigerians interested in crypto and trading these digital assets, and acted promptly to safeguard individuals investing in the field.
As a result, the Nigerian Securities and Exchange Commission (SEC) has to draft new laws governing Crypto-tokens and Crypto Investments, defining when they qualify as securities transactions. Until shown differently, the Commission believes virtual crypto assets are securities. This means that the issuer or sponsor of the crypto assets must provide the crypto assets, which is beyond the SEC’s authority. Founder of Blockchain Nigeria User Group, Chimezie Chuta said:
“The regulations provide the long-overdue legal framework for governing digital assets and blockchain investments.”
“Nigeria has constantly shown a knowledge of her role in fostering the rise of Virtual Financial Assets and Cryptocurrencies in general. Determining institutional investor trust in the Nigeria Capital Market and a catalyst for broad adoption of cryptocurrencies in Nigeria”.
Another important cause is the increasing prevalence and use of encryption. But the pandemic issue has soured it in the nation, according to a State of Play study, cryptocurrencies have recently gained the attention of some African adolescents. Since the epidemic hit first in Africa, Bitcoin adoption has skyrocketed, giving it the second-strongest peer-to-peer market volume margins.
Meanwhile, Bitcoin (BTC) P2P trade volumes hit new highs in countries including India, South Africa Ghana Kenya Argentina Chile Nigeria. UsefulTulips’ data from Localbitcoin and Paxful.
According to an independent researcher study, Nigeria led the way with $34.4 million in peer-to-peer transactions in the second quarter of the year, followed by South Africa with $15.2 million, Kenya with $7.8 million, and Ghana with $640,000. It is clear that the industry is rapidly expanding throughout the nation.