Bitcoin is the most popular decentralized peer to peer cryptocurrency. It is one of the hundreds of available digital assets and has gained wild popularity in Nigeria. It is used for a range of purposes including online payment and hedging.
Introduction to Bitcoin
Backed by the Blockchain technology, Bitcoin was developed in 2008 by an anonymous person or group of people under the pseudonym “Satoshi Nakamoto“.
Bitcoin makes a payment on mobile devices easy: when a wallet is installed on a smartphone. Many stores that accept Bitcoin display with a barcode that one can scan from the smartphone to make payment.
It is backed by military-grade security that keeps the cryptocurrency wallet secured and intact. Of course, you need to take steps to keep your coins secures are breaches are not impossible.
It works anywhere and everywhere (across international borders) at any time. It allows users to choose their own fees (lower fees can result in slower bitcoin transactions) and to pay relatively anonymously.
While it already had some usage in Nigeria, it became mainstream from 2016 due to the wild popularity a Ponzi scheme known as MMM Global. Its local subsidiary traded as MMM Nigeria.
Bitcoin was one of the payment methods promoted by MMM. The scheme exposed many of the about 2.4 million participants to the digital wallet.
How to open a Bitcoin Wallet
Time needed: 5 minutes.
Just like your physical wallet or bank account, you would need storage for the coins. It is possible to install a Bitcoin wallet on your computer or smartphone for storing the coins. The wallets would offer a bitcoin address or addresses for you to accept coins from other users. They also store the private key(s) to authenticate the spends. You can choose any of the 4 methods to store your coins. Their features and level of security.
- Desktop Wallets
They come as Windows, Mac or Linux apps that can be installed on laptops or desktop computers. The 9 apps listed are available on 3 platforms: Bitcoin Core, Bitcoin Knots, Bither, Electrum, mSIGNA, Armory, Wasabi, BitPay and Green Address.
- Hardware Wallets
They come as USB drives, keyrings, or some other form of portable hardware. These include BitBox, Coldcard, KeepKey, Ledger Nano S, and Trezor.
- Mobile Wallets
The availability of the apps varies according to the smartphone’s operating system. Bither, BitPay Wallet, BRD, BTC.com, Coin, Edge are available on both Android and iOS. Eclair Mobile, Electrum, Mycelium, Bitcoin Wallet and BLW are presently available on Android only.
These are services that offer bitcoin wallets through their website. Some of them are BitGo, BTC.com, and Coin Wallet.
How can I buy Bitcoin in Nigeria?
There are thousands of companies and individuals that offer the conversion of Nigeria’s fiat currency Naira as well as money from other digital currencies to Bitcoins. They would mainly be split into exchangers and trading platforms.
- companies: dozens of these offer the sale or exchange of bitcoins primarily through their respective websites or mobile apps. They typically accept Naira payment via MasterCard, Visa, Verve cards, online bank transfer or some mobile money platforms.
- trading platforms: these allow individuals to buy and sell bitcoins and typically offer a secure platform that includes escrow. They usually attempt to verify does who trade on their platform in other to guarantee a secure environment for their users. Notable examples are Localbitcoins and Paxful.
How to accept Bitcoin Online
It is possible to accept bitcoin payments through your own e-commerce website in Nigeria for your business. There are dozens of online solutions that make this possible. Many of the web wallets listed above also offer merchant services that are fit for purpose.
They would typically offer an API that makes their service work with online store platforms. Popular bitcoin gateways include BitPay, Coingate etc.
It is also possible to go the simple route of simply giving your bitcoin address to the payer. He or she can then simply send bitcoin from their own wallet. This option would typically apply to freelancers and is straight-forward.
Where to use Bitcoin in Nigeria
There are thousands of merchants that accept bitcoin across the world. For example, Web4Africa accepts Bitcoins and dozens of other cryptocurrencies like Bitcoin Cash, Ethereum, Litecoin etc for all the services we offer:
Other merchants accept bitcoin for a wide range of products and services.
FAQ about Bitcoins
We answer some Frequently Asked Questions about Bitcoins.
The price of bitcoin relative to traditional currencies varies by the minute. It is very volatile. For example, as of 4:56 pm on 4th August 2019, 1 BTC = 3 856 409,70 Nigerian Naira. The price at the moment you are reading this would be different.
The banking regulator and issuer of Nigeria’s Naira notes and Kobo coins, the Central Bank of Nigeria, appears to actively discourage the use of Bitcoin in Nigeria. They sent a notice to all financial institutions in January 2017, warning against the conversion of Naira to BTC. As of now, one can say their position is neutral to the extent that the government cannot control bitcoins. They are however paying attention to the extent they can. Bitcoin is not illegal but not encouraged in Nigeria.
There is no objective way to access which wallet system is the best for Nigeria. One safe way to decide which wallet to go for would be one that is backed by a company that is legally registered in Nigeria and maintains local bank accounts. That way, there is some leverage regarding access and accountability.
Considering bitcoin is not regulated by the government, there is hardly any customer or legal protection.
You would need to research and make the decision yourself. It is however very important to consider a few factors. When dealing with an exchange company, confirm their legal status and office location. If dealing through a trading platform, ensure the individual is an experienced trader with lots of confirmed trades and excellent ratings.
Like every other investment scheme, it is super important to know that investing in bitcoin is very risky – same way Forex Trading can be risky. It is possible that the value of bitcoin can still improve drastically in the future. Do not invest what you cannot afford to lose.