During the police brutality protests in Nigeria in October, bitcoin saved the day when the government shut out protesters from using local payment platforms for collecting donations to support it.
The young, tech-savvy protesters quickly switched to using bitcoin, and in about a week bitcoin accounted for around 40% of the nearly $400,000 raised. It was just one high-profile example of how young Nigerians increasingly use bitcoin to navigate a complicated and restrictive banking and monetary system.
Bitcoin trade had its highest spike of 30% this year during the national lockdown in the country and the highest volume traded during the peak of the pandemic. Between January and September, Paxful reported a 137% increase in new registrations in Nigeria.
The data gathered from leading peer-to-peer bitcoin exchange Paxful between May 2015 and November 2020 shows that the United States ranks first with a total trading volume of 535,660 BTC ($3.76B) within the period.
Nigeria takes the second position with a total of 60,215 BTC ($5П267M) traded within the last five years compared to third-place China with a volume of 20,553 BTC ($181M). This also makes Nigeria Africa’s largest Bitcoin market.
Peer-to-peer (P2P) exchanges, which are decentralized platforms that directly connects buyers and sellers without third parties are the most popular way to buy bitcoin in Africa because users do not have to worry about cryptocurrency regulation by the government. Paxful is the largest platform for P2P trade in Africa and overtook LocalBitcoins in June this year to be the Largest P2P bitcoin marketplace in the world, controlling 52% of the market share.
The value of bitcoins traded in Nigeria over the last five years is more than any country in the world, except the United States. According to the latest data on trading activity on Paxful, a peer-to-peer bitcoin marketplace, as provided by Coin Dance – an online platform providing Bitcoin statistics and services – Nigeria traded bitcoins worth more than $566 million between 2015-2020.
The data also shows the number of bitcoins that Nigeria traded in the five-year period was 60,215. The country was surpassed only by the US where 535,660 bitcoins were traded between 2015-2020. The value of that volume of digital currency stood at $3.8 billion.
The volume of bitcoin trades in Nigeria was 10 times more than that of Kenya, the second-largest African bitcoin market, trading 5,895 bitcoins worth $55.3 million in the last five years. The third largest market on the continent is South Africa with 1,802 bitcoin trades valued at $18.9 million.
Bitcoin trading in Nigeria has increased by 102 per cent so far in 2020. While the year is not over and despite the COVID-19 pandemic, Nigeria has seen more bitcoin trading in 2020 than ever before, with 20,504.50 bitcoins traded as of November 14. The value of the bitcoin market in Nigeria thus far this year is $213.7 million.