Cryptocurrency Ban in Nigeria Continues – People Selling BTC at High Price
According to one of the on-chain data analyzing firms, the selling price of Bitcoin (BTC) in the Nigerian crypto-exchange markets was at $76k per BTC. This information was collected by the on-chain data analyzing firm on February 18, 2021.
While the selling price of Bitcoin (BTC) around the world was standing at $52k per BTC on February 18, Bitcoin (BTC) in Nigeria was being sold at $76k per BTC. This proves that Bitcoin (BTC) in Nigeria was being sold at a really high rate and the price difference was around $24k between the actual and Nigerian price.
At this point, the main question and concern are why Bitcoin (BTC) was sold at such a high price in Nigeria. The second concern is that even if it was being sold at such a high price, why were people buying it.
According to the latest reports from Nigeria, it is the Central Bank of Nigeria that has triggered this frenzy. The Central Bank of Nigeria (CBN) had reportedly issued a directive to all the banks in the country to suspend any activities related to cryptocurrencies.
The CBN instructed all the banks in the country to also close any accounts that they were managing for cryptocurrency exchanges. On top of that, the CBN instructed all the cryptocurrency holders to liquidate their crypto-holdings before the industry would be banned completely.
The directive for the banning of cryptocurrencies in Nigeria was issued by the CBN on February 5, 2021.
Although the cryptocurrency industry is unregulated and decentralized, yet the exchanges have observed the Nigerian investors leave their platforms.
This is mainly due to the banning of cryptocurrencies in the country because investors are worried about being met with any legal actions.
One of the crypto-reporting firms also approached the CEO (ChiagozieIwu) of a cryptocurrency exchange in Nigeria, Naijacrypto. The reporting firm wanted to get insights on the cryptocurrency prices surging only in Nigeria.
To give a better understanding of the matter, Iwu first clarified that every exchange in Nigeria tends to offer a different rate for BTC. The reason why the exchanges have done this is because of the increasing demand for cryptocurrencies and the costs of acquiring them.
He stated that before the directive was issued by the Central Bank of Nigeria, all of the cryptocurrency exchanges in Nigeria had a single source for liquidity.
This liquidity source ensured that the users would not find it difficult to get naira against cryptocurrencies or vice versa.
However, as the directive issued by the Central Bank of Nigeria has now started getting picked up, the situation has started going south. Now there is no unified liquidity provider in Nigeria, which means that every liquidity provider will be coming up with a different price.
This is the reason why the spreads between the prices of Bitcoin between Nigerian as well as international exchanges are widening.