Lack of proper financial services boosts crypto ownership in Nigeria, says report

A new study has revealed staggering growth in crypto adoption across Nigeria, fueled by limited access to affordable fiat-based financial services in Africa. 

Crypto exchange KuCoin’s “Into the Cryptoverse Report” highlights that many Nigerian citizens have started using cryptocurrencies as a viable alternative to store and transfer assets.

According to the report, 35% of the Nigerian population aged 18 to 60 — or 33.4 million people — have owned or traded cryptocurrencies during the last six months. Out of those people, nearly 17.36 million (or 52% of Nigerian crypto investors) have allocated over half of their assets to cryptocurrencies.

One of the main reasons why investors across the globe seek to diversify traditional assets into cryptocurrencies is to counter rising fiat inflation. For example, a selection of United Kingdom investors was surveyed last month, and the majority considered tokens to be safer and more secure than traditional investments such as gold, oil, stocks and real estate.

The KuCoin report further highlights peer-to-peer trading as the most popular method among Nigerian investors to convert fiat into crypto assets. Doubling down on the crypto adoption spree, roughly 23.38 million Nigerians, or 70% of existing crypto investors, will increase their cryptocurrency investments over the next six months.

The value of the naira, the nation’s fiat currency, has fallen by over 209% in the past six years, which stands as one of the key drivers for local investors to eye deflationary assets such as Bitcoin (BTC).

The report also shows that while a majority of Nigerian crypto investors began their hodling journey many years ago, 26% began investing in cryptocurrencies just six months back — owing to the 2021 bull run, which saw BTC prices briefly cross the $69,000 mark.

In October 2021, Nigerian President Muhammadu Buhari introduced the country’s central bank digital currency, the eNaira. Numerous governments across the globe intend to use CBDCs as a digitized fiat replacement, primarily aimed at reducing operational costs and speeding up cross-border payments.

The eNaira is considered the most developed CBDC, scoring 95 out of 100 across both the retail and wholesale categories in PwC’s recently released “2022 Global CBDC Index.”

Related: New crypto owners nearly doubled in 3 key regions in 2021: Report

Earlier in April, a study released by crypto exchange Gemini confirmed a massive rise in global crypto investors in 2021.

As Cointelegraph reported, India, Brazil and Hong Kong witnessed the highest crypto adoption, with more than 50% of respondents acknowledging investing in cryptocurrencies.

Gemini’s report also found that Indonesia and Brazil are leading the world i the share of cryptocurrency investors among the general population.