Real Use Case | Google Trends Hit Record Highs, Why Are Nigerians Fond of Bitcoin?

Nigeria is a West African country located in the Gulf of Guinea. Despite being the second-largest economy in Africa, after South Africa, the country faces long-standing high unemployment rates and inflation, posing economic challenges for many at the grassroots level. Nigeria also operates with foreign exchange controls, leading its citizens to take notice of Bitcoin.

According to a report by CoinDesk, Chukwuemeka Ezike, a Nigerian, serves as a community manager at the Huobi exchange. He engages in monthly trade negotiations with Chinese companies using Bitcoin to assist his family's business in purchasing car parts, equipment, and more. He mentioned

Bitcoin is much faster than cross-border remittances and allows bypassing the daily $10,000 bank transfer limit. I convert Bitcoin to Chinese Yuan through an intermediary on WeChat and then transfer the funds to the vendor. However, I cannot disclose the company as China is sensitive about data.

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Global Trade with Bitcoin

For specific use cases, Bitcoin has facilitated global trade, as transactions involving Bitcoin are often faster and cheaper than traditional cross-border remittances, assuming the recipient is willing to accept Bitcoin. However, this is merely a hypothetical scenario, as Bitcoin has not revolutionized international trade payments or everyday transfer methods. The general public still does not fully understand the utility of this seemingly "game coin" virtual currency and may never do so, as there is a possibility that Bitcoin may never achieve widespread adoption.

Furthermore, the Bitcoin network still faces significant limitations and cannot handle large transaction volumes, not to mention that on-chain congestion can slow down transaction speeds and increase transaction costs. Nevertheless, Nigerians are increasingly relying on Bitcoin for international trade and are discovering the advantages of Bitcoin over traditional financial systems.

The data from Google Trends in the image above also indicates that Nigerians' interest in Bitcoin has been steadily increasing, surpassing the levels seen during Bitcoin's historical high near $20,000 in 2017. Additionally, in global rankings, Nigeria has been the country with the highest interest in Bitcoin over the past year and five years.

Nigeria's Foreign Exchange Dilemma

Chimezie Chuta, an IT expert and Bitcoin advocate in Nigeria, is dedicated to deploying solar-powered Bitcoin Lightning Network nodes across Africa. Regarding the trade use case of Bitcoin, he stated:

Nigeria is an economy heavily reliant on imports, including food, drugs, building materials, and cars, mainly from Chinese manufacturers. However, due to restrictions from the central bank, businesses have limited opportunities to import through foreign exchange, necessitating a way to convert the local currency, the Naira, into foreign currencies, either through the high exchange rate black market or Bitcoin.

Chuta emphasized, "In Nigeria, finding channels to exchange dollars or yuan is not easy. I'd like to avoid our obsession with the dollar and all these bird issues. With Bitcoin, I can complete all cross-border remittance processes, it's faster, open to everyone, and requires no trust."

Caution and Discreet Usage

Entrepreneur Monyei Chinazaekpele in the country also uses Bitcoin as a means of payment for international trade. He reiterated the views of Chuta and Ezike, stating:

In Nigeria, conducting foreign exchange transactions is very difficult, and the Naira is not a good value storage tool, with annual inflation reaching as high as 12%. However, Bitcoin does not have this issue and historically has been on the rise.

However, due to the unclear legal status of Bitcoin, most people remain completely discreet about using Bitcoin for payments. Ezike pointed out:

We are unsure of the government's actions, so we keep a low profile. That's also why I don't disclose my dad's business name. China is the same; everyone involved in Bitcoin transactions keeps a low profile.

Regarding the Nigerian authorities' stance, Ezike expressed hope, saying, "They are quite confused about how to handle cryptocurrency regulations, but I still hope they will eventually accept it."