Inconsistent policies surrounding fiat currencies in Nigeria has caused panic, and given rise to an unclear future for investors as the Central Bank of Nigeria struggles to stabilize the Naira. Could this be a perfect opportunity for Bitcoin and other Cryptocurrency startups to break into the largest market in Africa?

Another new policy

In a press conference by the governor of the Central Bank of Nigeria, Godwin Emefiele on Monday January 11 2016, he announced that the nation’s apex bank will be stopping the sale of forex to Bureaux De Change operators within the country. Mr. Emefiele also announced that the ban on dollar deposit into domiciliary accounts by individuals or corporations in commercial banks was being lifted. This was a ban which took effect from the first week of August 2015 after the release of a circular signed by the Director of Trade and Exchange of the CBN, Isiaka Gbadamosi. Here is a summary of the announcement:

“a) The Bank would henceforth discontinue its sales of foreign exchange to BDCs. Operators in this segment of the market would now need to source their foreign exchange from autonomous sources. They must however note that the CBN would deploy more resources to monitoring these sources to ensure that no operator is in violation of our anti-money laundering laws;

b)The Bank would now permit commercial banks in the country begin accepting cash deposits of foreign exchange from their customers.”

Investors are looking for an alternative

The rate of change of policies and the urgency with which they take effect has become worrisome for investors who now live in fear of an uncertain future, as policies keep changing without warning or signal. This explains the volatility surrounding the Naira as it hit its all-time low in the parallel market barely twenty-four hours after the CBN governor’s announcement, selling at 292 Naira to the Dollar.

Bade-Ajidahun Oludahun is the Regional Manager, Africa at ICM Capital, an international online Forex and CFD trading firm offering 24 hour access to a diverse range of trading products including foreign exchange, commodities, futures and indices. Oladahun thinks that the situation is becoming unhealthy for local investments, saying that investors are already beginning to look elsewhere. He puts it this way:

“Investors are already beginning to search for alternatives, and this is the perfect opportunity for startups in alternative currency investments in Africa, considering the available market in Nigeria. Bitcoin is already looking attractive because it is not dependent on government policies.”

Interesting days ahead

The founder of the UK Bitcoin payment gateway, Cryptopay, George Basiladze predicts an interesting season in the Nigerian Bitcoin market.

George Basiladze, founder of Cryptopay

George says:

“This is a great opportunity. Nigeria is a big market for bitcoin remittance companies and I believe we would see a lot of interesting movements soon.”

As the fiat currencies try to find a balance within the country, it is beginning to look like the perfect storm for Bitcoin and other cryptocurrency startups to engage the largest market in Africa.

One thing is certain; INVESTORS ARE LOOKING FOR A WAY OUT!!!

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