Crypto Adoption in Nigeria is Fueled by Limited Access to Financial Services (Study)

According to research conducted by KuCoin, the growing number of Nigerians investing in crypto is propelled by the lack of proper fiat-based opportunities. The study revealed that over 30 million of Nigeria’s population had traded digital assets in the past six months.

The Reasons Behind the Adoption

KuCoin’s latest “Into the Cryptoverse Report” found out that 33.4 million Nigerians, or 35% of those aged 18 to 60, have owned or traded cryptocurrencies in the last six months. 52% (approximately 17.3 million people) have distributed more than half of their wealth into the asset class. Moreover, 70% of the crypto investors vowed to increase their exposure by the end of 2022.

KuCoin claimed that one of the main reasons for the interest in the sector is the limited access to monetary services in Africa’s most-populated country. Despite being one of the financial hubs in the Western region of the continent, vast rural areas in Nigeria lack proper banking and fiat-based opportunities.

Another reason for Nigerians to diversify traditional assets into cryptocurrencies is to battle the rising inflation. The post-pandemic situation, the energy crisis, and the financial turmoil that the Russia-Ukraine military conflict propelled have reached Nigeria’s borders, too. The country’s inflation rate currently stands at over 15%, and millions of the residents chose crypto as a store of value alternative, KuCoin estimated.

The research further revealed that the majority of Nigerian crypto holders entered the market many years ago. In comparison, only 26% began investing six months ago, driven by the 2021 bull run when bitcoin’s price almost tapped $70,000.

Brazil and Indonesia: Leaders in Crypto Adoption

Earlier this month, a global study conducted by the digital asset exchange Gemini outlined that Brazil and Indonesia are the leading nations in terms of cryptocurrency adoption. Approximately 41% of the polled individuals from both countries admitted owning bitcoin or some altcoins.

Gemini noted that residents living in states with significant economic hurdles are more likely to purchase cryptocurrencies as a hedge against inflation. Such is the case with Indonesians, as 64% admitted this is their reason to enter the market.

The figures in leading economies like the USA or the UK are quite different. The adoption rate there is respectively 20% and 18%. Moreover, only 16% of Americans see crypto as an appropriate investment tool in times of surging inflation, while 15% of Britons believe in this concept.