New research reported has predicted Nigeria to be at the forefront of global crypto adoption by the end of this decade. According to data by Merchant Machine, if the crypto use rate in the country continues this, way, the entire population of the African country will be using digital assets by 2030.
Recall that according to a study by crypto market tracker Coingecko two weeks ago, Nigeria is leading the pack of countries with the highest interest in crypto despite the market correction experienced in 2022.
The Merchant Machine study focused on finding countries investing the most in crypto by sampling different metrics from 50 countries. Specifically, the score factored in the number of crypto owners in a country, the global decentralized finance (DeFi) adoption index, the number of businesses that allow crypto payments, the number of Bitcoin (BTC) ATMs, and the monthly search volume of cryptocurrency terms.
It is however surprising that Nigeria which is billed to have full adoption by 2030 did not make it to the top ten list of countries currently utilising cryptocurrencies.
The research indicates that the United States ranks top globally in the overall use of cryptocurrencies, scoring 7.75 out of 10. Ukraine ranks second with a score of 5.96, followed by the United Kingdom at 5.79 with India and Thailand occupying the fourth and fifth positions with 5.52 and 5.3 scores respectively.
Why Nigeria is leading the pack
Nigeria is regarded as the largest crypto market in Africa and the catalyst for that feat is connected to the continuous devaluation of its local currency, growing inflation and worsening economic conditions.
The citizens of the West African country see digital assets as a way to hedge against the plunging naira. Some too, especially the younger demographic see crypto as a form of investment and business they can earn a decent living from.
These and a few other reasons are probably the considerations Merchant Machine considered for the projection. According to the report:
“Nigeria is at the top of the list, with an estimated 100% by 2030. This means that if crypto use continues to grow at its current rate, the entire population of Nigeria will be using cryptocurrencies!
The popularity of cryptocurrency could be explained by the country’s poor economy making alternative currencies appealing. The devaluation of Nigeria’s currency, the naira, will likely continue to drive more and more Nigerian natives to invest in cryptocurrency instead.”
How realistic is the mark
As much as Nigeria will definitely see an increase in crypto adoption in subsequent years in tandem with the global shift from traditional finance to the blockchain, the Merchant Machine 100% expectation by 2030 sounds too idealistic.
There are a few too many barriers in the country that would take more than a decade to address. In Nigeria today, hardly will you find 1 out of 10 businesses utilising crypto as a payment method. As a matter of fact, outside major cities like Lagos and Abuja, it will be a herculean task to find a retail outlet accepting digital currencies.
Also, a country with 36 states has only one bitcoin ATM which is situated in Lagos, with questionable functionality. Its counterpart, South Africa, has seven.
To compound issues, there is confusion surrounding the legality of crypto in Nigeria. In February 2021, the Central Bank of Nigeria placed a ban on crypto activities in the country. It followed it up with a sanction on five banks for engaging in crypto transactions in April 2020.
In the same country, the Nigerian Securities and Exchange Commission in May rolled out a new set of regulations to guide the issuance, custody and exchange of digital assets like Bitcoin and Ethereum.
Chimezie Chuta, a tech expert and founder of Blockchain Nigerian User Group (BNUG) echoes these thoughts. In a statement to Technext, he says there will be a surge in users, but there will still be a section of the population that will not be impressed with the blockchain technology.
“A 100% adoption by 2030 is overkill. Clearly, there will be a large portion of people who will remain unmoved by crypto technology, especially the aged and the illiterate majority. 60% is more realistic for me. But for this to even happen, there has to be a strong commitment from the government and its agencies. As long as the monetary policymakers continue to scare off new users, and as long as crypto- scams continue to go unchecked, institutions will continue to stay on the sidelines.”
“What is required is an honest synergised collaboration between stakeholders, policymakers and regulatory agencies to acknowledge the economic potentials of crypto technology, alongside blockchain to drive mass adoption with eyes on the big picture of its economic benefits”, he adds.
Hopefully, if the right structures are put in place, a significant drive towards adoption more crypto adoption.
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