BITCOIN RATE FLUCTUATIONS : Bitcoin, the world’s largest cryptocurrency, has experienced significant growth in Nigeria in recent years. The country has one of the largest cryptocurrency adoption rates in the world, with many Nigerians using Bitcoin as a store of value and a means of exchange. However, the price of Bitcoin in Nigeria is highly volatile, and it can be challenging to understand the factors that influence its value.
Bitcoin, like any other asset, is subject to market forces that determine its price. These market forces can be broadly categorized into demand and supply factors. In Nigeria, the demand for Bitcoin is driven by several factors, including its use as a store of value, its potential as an investment, and its role in facilitating international money transfers.
The supply of Bitcoin in Nigeria is determined by the number of people who are willing to sell it. The supply is influenced by several factors, including mining activity, regulatory changes, and the adoption of Bitcoin by businesses and individuals.
Drivers of Bitcoin Demand
One of the most significant drivers of Bitcoin demand in Nigeria is its use as a store of value. Nigeria’s economy has been plagued by inflation, currency devaluation, and political instability, which has led many Nigerians to seek alternative ways to preserve their wealth. Bitcoin’s decentralized nature and limited supply make it an attractive store of value for Nigerians looking to protect their assets from inflation and currency devaluation.
Another factor that drives Bitcoin demand in Nigeria is its potential as an investment. Many Nigerians view Bitcoin as a high-risk, high-reward investment opportunity. The cryptocurrency’s volatility makes it a risky investment, but its potential for high returns has attracted many investors who are willing to take on the risk.
Bitcoin is also popular in Nigeria as a means of facilitating international money transfers. Traditional methods of sending money across borders can be expensive and time-consuming. Bitcoin offers a fast, secure, and cost-effective way to send money internationally, making it a popular option for many Nigerians.
Fluctuation of Bitcoin Price in Nigeria
The price of Bitcoin in Nigeria is highly volatile and can fluctuate rapidly based on market demand and supply. The price is determined by the market’s perception of Bitcoin’s value, which is influenced by several factors, including investor sentiment, regulatory changes, and technological developments.
Investor sentiment plays a significant role in Bitcoin price fluctuations. If investors believe that the cryptocurrency is undervalued, they will buy it, driving up the price. Conversely, if investors believe that the cryptocurrency is overvalued, they will sell it, driving down the price.
Regulatory changes can also have a significant impact on Bitcoin prices. In Nigeria, regulatory uncertainty has been a significant challenge for the cryptocurrency industry. The Central Bank of Nigeria (CBN) has issued several warnings about the risks associated with cryptocurrency investments, which has led to a decline in Bitcoin prices. However, the government’s recent move to regulate the industry has boosted investor confidence and driven up Bitcoin prices.
Impact of Bitcoin Fluctuation in Nigeria
Technological developments can also impact Bitcoin prices. The development of new technologies that enhance Bitcoin’s utility and security can drive up demand, while security breaches or hacks can drive down demand.
The fluctuations in Bitcoin rates can have a significant impact on the daily finance market in Nigeria, particularly in the areas of investment, trade, and remittances.
Firstly, Bitcoin rate fluctuations can affect investment decisions in Nigeria. Investors who are interested in investing in Bitcoin may be deterred by sudden drops in Bitcoin rates. Similarly, some investors may be tempted to invest in Bitcoin when rates are high, hoping to make quick profits. This can create an unstable investment market, as investors may be more likely to make impulsive investment decisions based on short-term fluctuations.
Secondly, Bitcoin rate fluctuations can also affect trade in Nigeria. Bitcoin is often used as a means of payment for international trade, as it can be transferred quickly and securely across borders. However, if the value of Bitcoin drops significantly, importers and exporters may have to adjust their prices and budgets to accommodate the changes. This can lead to uncertainty and instability in the trade market, as businesses may struggle to predict the impact of Bitcoin rate fluctuations on their transactions.
Finally, Bitcoin rate fluctuations can affect remittances in Nigeria. Remittances are an important source of income for many Nigerians, with millions of dollars sent from abroad every year. Bitcoin is increasingly being used as a means of sending remittances, as it can be done quickly and at a low cost. However, if the value of Bitcoin drops significantly, the amount of money received by the recipient may be reduced, which can have a significant impact on their financial stability.
Trading Bitcoin for Naira
Regardless of the issues faced by Nigerians on a daily basis as regard the use of Bitcoin, experts out there are always finding solutions on how they can make life easier for other Nigerians. Chief among these solutions (apart from established platforms like Binance and KuCoin) is DartAfrica.
Let’s assume you have a relative that wants to send you some money but doesn’t want to send it directly as fiat, DartAfrica allows users to make Bitcoin deposits directly into a uniquely generated wallet that can then be converted to fiat at unbeatable and stable rates. The fiat can then be withdrawn directly into your local bank. The uniqueness of DartAfrica is that you do not need to hold your coins on the web application, you just deposit when you need. This significantly improves the security of your funds. Head over to DartAfrica and sign up in under 5mins.
- You proceed to the dashboard, click on sell coins, enter the amount you want to sell (minimum is $20), and you’re instantly given a wallet address to send the bitcoin to once it is completed (after two block confirmations), you proceed back to the dashboard.
- On the dashboard, you click on trades to see the status of your initialized trade and then, when it changes from created to successful, you can proceed back to the dashboard to see your credited funds.
- Click on withdraw, enter the amount you wish to withdraw directly to your local bank account, and voila, you’re credited instantly.
Overall, the fluctuations in Bitcoin rates can have a ripple effect on the daily finance market in Nigeria, creating uncertainty and instability in investment, trade, and remittance transactions. It is important for individuals and businesses in Nigeria to stay informed about Bitcoin rate fluctuations and their potential impact on their financial activities.
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