You have probably heard the news about the Central Bank of Nigeria (CBN) imposing a ban on financial services for cryptocurrency exchange operators, as well as the incongruent excuses for its action. You may have also heard of several connected controversies, like how it’s linked to the endSARS protests, aid for which was partly funded in bitcoin.
What you probably don’t know, though, is how this is related to the economic shock from the COVID-19 pandemic, the huge arbitrage gap in the naira (NGN) prices across the Nigerian currency market, the decline in Nigeria’s inflow remittances and the emotional tension of individuals whose funds are sadly trapped in all of this.
Over the course of this piece, we will be looking at the economic state of Nigeria prior to the cryptocurrency exchange ban and how it has influenced rapid cryptocurrency adoption, the involvement of the Nigerian senate and what will most likely ensue next.