CRYPTOCURRENCY: Bitcoin In Nigeria

For those familiar with the market, i guess they would concur when I say that Nigeria’s love with cryptocurrencies started with a scam. Millions of Nigerians lost their money between late 2015 to end of 2016 due to a 30-year-old Ponzi scheme known as Mavrodi Mondial Moneybox (MMM) that began in Russia. The scam promised 30 percent returns in 30 days, which eventually brought it to the notice of the government

MMM’s operators cut banks out of its deal when the government forced a crackdown on the accounts linked to the scheme and started requiring victims to use bitcoin. Before suspending its payouts in late 2016, MMM had already duped an estimated three million people in Nigeria of $50 million.

This single incident exposed Nigerians to the world and the workings of bitcoin. The dramatic surge in the price of the cryptocurrency has also led many to see it as the currency of the future.

Lucky Uwakwe, co-founder of Blockchain Solutions Ltd. said,

“Trade has risen to around $4.7 million worth of bitcoin every week up from about $300,000 a week since last year.” According to a researcher from CryptoCompare, the volumes traded in Nigeria are comparable to those in Indian Rupees and Chinese Yuan but far lower than the $1 billion traded daily in the US.

---

The scams, however, have continued.. Scammers promote their get rich quick schemes and as usual 'dissolve' into thin air, once they've ripped off their unsuspecting victim. Many a time,tricksters disguise as a royal Nigerians and persuade fortne seekers to wire money in exchange for bitcoin. A few cases have also been noticed where scammers used details of a real dealer to create a trading profile that passes background checks.

According to Aminu, a digital security expert and Bitcoin enthusiast, “Everyone I know of has been scammed in some or the other way.” This motivated Aminu to form an informal trader group on the popular messaging app Telegram. The group, today, is used as an informal exchange for trading among its members. A new member of the group needs to have his documents and bank details verified by the administrator. He also started acting as a broker holding a buyer’s money in escrow until the seller liquidized his position.

At the moment, Aminu’s group has grown to include more than 800 members. He said that there are several such groups which have a wide array of security procedures and some of which also arrange face-to-face meetups for trading bitcoin. Importantly, Aminu recently removed more than 100 people whom he felt were not trustworthy. As a result, a growing number of informal networks of professional bitcoin traders in Nigeria are verifying transactions. These informal groups all contribute to the Nigerian trading volume. It is also necessary to note thatthe size of Nigeria’s bitcoin/cryptocurrency market could thus be much bigger because of this informal trading, as they are not included in public figures.

In conclusion, with the way the African market is opening up to this innovation, I believe cryptocurrency is more than a bubble- regardless of it's volatility rate.

For the love of Steemit!

---

Please Follow and Upvote @ekeomachimdi