If you are a participant in the Crypto space, you will always come across some interesting news about what’s happening in the market. In recent news, the case of high prices of BTC in Nigeria is taking a huge position!
The price of Bitcoin Sprint is rising by an extreme amount in this nation. The price range of Bitcoin is 60% higher than the regular prices around the globe. This aspect is leading the ATMs to limit the number of cash withdrawals. But should you celebrate this news or have a deep thought about it? Let’s find it out in the blog!
Is This A Matter To Worry About?
This news is spreading across the Crypto industry and is grabbing the headlines of top sites. The entire Cryptocurrency community is celebrating this news with much joy.
Crypto enthusiasts are looking forward to this news as a good sign for the market. So they are sharing this news over social media! But is this a positive indication for the country too?
The rise of the prices to the peak is not a sign of excess demand for the asset. Rather, the population is demanding USD more than just the token alone! The native currency of this nation has been suffering for a long time. Due to this, the community here is tilting more towards the US Dollar.
The Limit in Cash Withdrawals
The cases of high prices were first brought to notice by the media. Different platforms looked after this and revealed the news about high premiums. The media platforms are pointing out that the cash limits of ATMs are responsible for this high price.
The nation took the step to limit cash withdrawals as the government was working on creating new notes. This limitation was established by the government on 6 December last year. But the government has been reducing some of the restrictions since January!
What is The Reason Behind This Increase in Bitcoin Price?
Everyone is assuming that the rate of Bitcoin is spiking due to cash limits in the ATMs. Many people believe that with the deficiency of cash among the population, everyone in Nigeria is demanding Bitcoin.
But this is not the case! Because this should have happened when the ATM limits were introduced in the early days of December! But it did not happen during that period, which shows that it is not the prime reason behind the increased demand for BTC.
A research analyst, Conor Ryder says that the premium is at a constant rate. And, there has been no increase in the amount of premium at all due to the ATM limit!
A Glance into The Internal Situations
The BTC premiums in Nigeria are not new and have been existing for a long time. These premiums show the distinction between unofficial and official USD exchanges. The rates of these exchanges in this nation will always have a discrepancy between them.
The state sets the official rate for exchanges. Due to the vicious cycle of currency devaluation, you can find USD at higher rates in different unofficial outlets. You will get BTC at Nigeria’s official dollar rate on platforms like Paxful.
Despite that, you will get BTC at unofficial rates in many outlets of the nation. This will indicate how the population of Nigeria is accessing the currencies in reality!
If you are planning to go through official exchange rates and get BTC in Nigeria, it may cost you around 68,000 USD! But the rate can be higher if you are opting for the unofficial rates!
Blockchain network project designer, Awosika Ayodeji, says that he is not complaining about this situation. Instead, he will get more returns now by selling his Bitcoins at unofficial rates! But, it also means that buying Bitcoin in Nigeria is now more expensive than ever!
Conclusion
Nigeria experiences high inflation and citizens are switching to Bitcoin because of the fall in the naira’s value. At a certain point, Nigeria’s Central bank released an order to shut down the accounts with Cryptocurrency trading. And stated that it was for the nation’s good!
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