Nigeria set to legalize Bitcoin usage

While Bitcoin (BTC) has dropped to its lowest level in the last two years, many organizations throughout the world have always considered it as a tool against inflation. Africa has, nevertheless, been a continent that has been dominant in the use and adoption of BTC. According to local media reports, Nigeria, a country in West Africa, will shortly enact a law recognizing the use of Bitcoin and other digital currencies to stay current with “global practices.”

Punch Newspapers, a Nigerian publication, broke the news on December 18, after speaking with  Babangida Ibrahim, the chairman of the House of Representatives Committee on Capital Markets.

According to the report, the local Securities and Exchange Commission would be able to “recognize bitcoin and other digital funds as capital for investment” if the Investments and Securities Act 2007 (Amendment) Bill is signed into law.

Ibrahim emphasized the significance of Nigeria staying updated with capital market trends and developments:

“We need an effective and robust capital market in Nigeria, as I stated during the second reading. We must be up to speed with international standards in order to accomplish that.”

Bitcoin adoption in Nigeria

In light of this event, it is crucial to note that Nigeria banned the usage of Bitcoin and other cryptocurrencies in 2021 and also issued a letter prohibiting regulated financial businesses from “dealing” with cryptocurrencies.

On the other hand, this year saw a considerable increase in the volume of BTC traded nationally, and according to Chainalysis, the West African country shattered adoption records for the cryptocurrency. Nigeria has surpassed all other countries in terms of global peer-to-peer bitcoin trade volume, according to the popular BTC-focused media outlet Bitcoin Magazine.

In addition to giving legal recognition to Bitcoin and other cryptocurrencies, the bill will specify the Central Bank of Nigeria’s (CBN) and Securities Exchange Commission (SEC) (Nigeria) regulatory functions on topics connected to digital currencies in addition to giving legal recognition to BTC and other cryptocurrencies, according to the article.

The eNaira, the digital currency issued by Nigeria’s central bank, has similarly received little to no interest from Nigerians, with an adoption rate of just 0.5% as of October, 12 months after its introduction.

Nigeria is one of the most populated countries in Africa, and if the upcoming bill addresses the concerns of investors, there may be a significant uptake of Bitcoin, which might then extend to other countries in the near future.

Despite the fact that using cryptocurrency is now prohibited in the country, the dominant cryptocurrency is widely used in the area. Crypto miners are also very active here, and a Bitcoin community is also being built.