How to Buy Bitcoin in Nigeria
itcoin has gained numerous popularity in Nigeria. Over the past few years more Nigerians have become aware of bitcoin and its advantages. The demand only seems to be increasing. In this guide, we will outline the legality, popularity, Bitcoin exchanges, and the different way you can buy Bitcoin in Nigeria.
Why is Bitcoin so popular in Nigeria?
Bitcoin’s surge in popularity doesn’t seem quite surprising given the country’s economic situation and currency. The country has artificially supported Naira prices for over a year since March 2015, despite falling oil prices and foreign exchange reserves.
The government hoped that such a move would protect itself from inflation, but eventually backfired. The country’s foreign currency reserves have been hit as fears of devaluation caused panic among foreign investors who have invested in stocks and bonds. With the onset of inflation, the government took extreme measures, such as managing foreign exchange demand.
In simple terms, Nigeria has declared that certain assets are not worth spending money. Banks also imposed restrictions on foreign spending that Nigerians. This has effected importers who need to make payments in foreign currencies such as the US dollar.
They now had the option to access the black market and access foreign currency at much higher rates. This is where Bitcoin intervened, as Nigerian users were able to pay foreign suppliers without much hassle. Not surprisingly, Bitcoin is the perfect currency for Nigerian entrepreneurs, as it can overcome Naira’s volatility and the control exercised by the central government.
Is Bitcoin legal in Nigeria?
Due to the Lack of regulations by the Nigeria government, many Nigerians presume that Bitcoin is illegal. However, bitcoin is not illegal, yet, it is not recognized by the Central Bank of Nigeria (CBN) as legal tender. In late 2017, Deputy Director of Banking and Payment Systems, Musa Itopa-Jimoh, clarified that the CBN statement was misinterpreted and that CBN could not control or regulate bitcoin because it does not own bitcoin like the Internet. Therefore, buying Bitcoin in Nigeria is not a criminal offence, nor is it illegal to use a Bitcoin exchange in Nigeria to convert Bitcoin to Naira. On the brighter side, the CBN has established a committee with Nigeria Deposit Insurance Corporation (NDIC) to consider the potential adoption of blockchain technology.
Bitcoin communities in Nigeria
The Nigeria bitcoin community is on both Facebook and Reddit.
• Bitcoin Nigeria FB Group
• Bitcoin Nigeria subreddit
• Nigeria Bitcoin Community
How to buy Bitcoin in Nigeria
There are several bitcoin exchanges based in Nigeria making it easy to buy and sell BTC. However, very few of these exchanges are reliable.
Online bitcoin exchange
This is arguably the most popular way to buy bitcoin in Nigeria. When thinking about Bitcoin and other cryptocurrencies, think about online exchange, for our PCCEX Bitcoin exchange, offering a wide variety of cryptocurrencies. Upon joining any exchange, there will usually give you certain limit to trade with until you will need to provide your ID and other documentation to complete the KYC process. Depending on the exchange selected, there are different options to fund your account. Credit card, electronic remittance, and bank transfer are the most common.
Steps to get started:
• Create an account on the selected online exchange
• Exchanges fund your account from available options or send you bitcoin to the exchange
• Start purchasing
• Provide necessary KYC if necessary
Local over the counter (OTC)
This is how PCCEX started in 2017. This is a transaction between two market participants who trade Bitcoin anonymously. OTC trading is also facilitated by OTC brokers who negotiate directly with buyers and sellers. The main difference between crypto exchange and OTC is the anonymous element provided by the OTC desk. OTC Desk does not provide a list of public order books for all transactions. This allows you to make large purchases without disruption from the market, also called the word “spill.” If available at the live quote price, part of the order will move to the next available sale price. This is usually higher (spill). Therefore, using the OTC desk to buy large amounts of bitcoin can save buyers money by protecting them from spills.
In summary, OTC brokers provide liquidity by eliminating slippage and coordinating buyers and sellers at mutually agreed prices.
Steps to get started
• Create an account on the platform that provides the OTC service
• Get live quotes from traders
• Accept price
• Buy Bitcoin
Buy OTC from broker
• Find a broker in your area
• Contact the broker and provide the required amount of bitcoin
• Get a quote
• Buy Bitcoin
It looks like Bitcoin ATMs are not bank ATMs, they are expecting to be connected to the Bitcoin exchange instead of being connected to a bank. This allows people to buy bitcoins using debit cards or cash. This system is perfect for buyers who are not technology savvy but want to own bitcoin. Bitcoin ATMs are increasingly appearing throughout the country, so finding them shouldn’t be too difficult. One thing to know when buying Bitcoin from ATMs is that the commission is much higher than buying from an exchange. Usually in the range of 8%-20%.
Steps to get started
• Find a Bitcoin ATM near you (coinatmradar.com)
• Insert debit card or pay by cash
• Select the required amount of bitcoin
• Scan the wallet and all sets
P2P transactions usually occur at peer-to-peer sites or platforms. Buyers and sellers connect on the site or platform and agree on the price. The seller’s bitcoin is held in escrow by the site and released only upon confirmation of payment from the buyer. An example would be localbitcoins.com
Steps to get started
• Register on the site or platform
• Get a digital wallet from the site
• Connect with the seller and agree on the price
• Pay the seller and all your sets
Nigeria is a classic example of a country in which bitcoin’s popularity is growing rapidly, thanks to the problems and restrictions faced by citizens while using traditional currencies. There are many ways to buy bitcoin in Nigeria. PCCEX is the most reliable an internationally recognized platform for buying bitcoin and other cryptocurrency.