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If you’ve been keeping an eye on the crypto industry, you possibly know how far it has come. Today, this industry that was once a niche is pulling the attention of people from all over the world. In fact, according to BusinessStats, the number of cryptocurrency owners now stands at over 600 million, up from 420 million in 2023. And unsurprisingly, countries like Nigeria have not managed to escape this boom.
You’ll often find people across both major and small cities using digital currencies for a variety of purposes beyond just trading. From Lagos’ busy tech hubs to smaller towns like Enugu, people are using these currencies to send money to family, pay for services and even buy goods at local markets. And this is actually a big part of why token prices are rising.
Consider the Ethereum price USD, for instance. According to crypto exchange Binance, this token, which was just a few cents during its launch, now peaks at over $2,300 as of the time of writing. And it’s not just individuals who are using these currencies for payments; even businesses are beginning to integrate crypto into their payment systems. But is this the future? Will crypto eventually become the obvious go-to solution for payments in Nigeria, or is it just another trend riding the wave of global hype?
The appeal of fast and cheap transactions
Truth be told, no one wants their funds delayed at such a time when things happen so fast. If your business delays transactions, you may frustrate users and even cause them to turn to competitors. According to IBS Intelligence, over seven in ten consumers cite slow transactions as a major reason why they abandon a purchase. Of course, this might not be any different with Nigerians.
And since crypto can help cater to the growing need for instant payments, it makes sense for businesses to adopt it. The technology is decentralised, eliminating the need for money to go through multiple intermediaries before reaching the recipient. As such, a customer won’t need to wait days or weeks to complete a transaction. Once the payment is initiated, it can settle almost instantly, sometimes within minutes or even seconds.
No third parties means reduced costs
The absence of intermediaries also means you won’t spend exorbitant costs on money transfers. Take a token like NANO, for instance. Thanks to its block-lattice architecture, you may actually end up paying zero transaction fees. And now that many Nigerians are looking for ways to reduce the cost of living, it becomes easy to understand why many of them now use digital currencies to complete their transactions.
To just put things into perspective, it might surprise you to discover that Nigeria’s crypto market has already hit $92.1 billion. This estimation by PwC was surprisingly three times that of South Africa, a market that has long been considered Africa’s financial powerhouse. Looking ahead, the institution expects the country to remain the largest crypto market in Sub-Saharan Africa, with usage partly sustained by the continued demand for stablecoins as a settlement rail.
Businesses under pressure to adopt crypto
Someone who frequently monitors cryptocurrency charts will, to some degree, expect businesses to start paying close attention to these trends. If a business fails to do so, it may start feeling left behind and eventually lose these tech-savvy users. Interestingly, Reuters says “95% of Nigerians would prefer receiving payments in stablecoins instead of Naira.” 75% of those who already own stablecoins intend to increase their stablecoinholdings within the next few months.
If you’re eyeing the Nigerian market, these are statistics you definitely do not want to ignore. Ignoring them could make your business feel less customer-centric, which, in turn, reduces competitiveness. On the other hand, integrating crypto-based systems like stablecoins can position a business as forward-thinking and customer-focused.
This may lead to better performance, with SuperOffice CRMclaiming that customer-centric businesses are 60% more profitable than non-customer-focused ones. Because of such statistics, it shouldn’t be surprising that crypto-based payments are becoming the norm in Nigeria.
The role of regulation
Regulations have a way of affecting how people view an industry. Highlighting how these developments affect the crypto industry, Rachel Conlan, CMO of Binance, says, “It means that many of the most important structures are still being formed now: in regulation, compliance, product design, institutional engagement, and organisational leadership. The people doing that work today are helping define what the next version of global finance will look like.”
And Nigeria has been one of those places where regulations are becoming clearer. In the past, the Central Bank of Nigeria (CBN) maintained a strict stance towards these tokens. But over the past couple of years, the stance has been softened, with the bank now encouraging collaboration between licensed financial institutions and regulated cryptocurrency platforms.
Regulatory initiatives such as the Accelerated Regulation Incubation Program (ARIP) help create clarity and trust for users and businesses alike. At a time when scammers are increasing, this confidence becomes crucial in determining whether people will be willing to adopt crypto as a mainstream payment method. So, when rules are clear, users tend to feel safe, which further leads to more adoption.
Putting all these factors together, it actually makes sense to expect more people and institutions in Nigeria to adopt crypto-based payments in the next few years. But since all these are speculations, you may want to keep your eye on the market to see how these developments play out in real time.
