The cryptocurrency boom in Nigeria — a country whose 206 million residents now drive the largest Bitcoin (BTC) market on the African continent — has been attributed to factors that range from its failing national fiat currency to the resourcefulness and proactivity of a young and tech-savvy population.
The rising popularity of cryptocurrencies has not gone unnoticed by Nigerian regulators. In February of this year, the Central Bank of Nigeria (CBN) imposed a ban preventing banks and financial operators from processing transactions for cryptocurrency exchanges.
Despite this setback, residents can still buy, sell and trade crypto in Nigeria. This guide will provide an overview of those platforms where it’s still possible to purchase crypto in Nigeria, as well offering information about the payment methods you can use to do so.
Payment Methods for Buying Crypto in Nigeria
Credit or debit card: Buying cryptocurrencies via credit or debit card remains popular, as it’s highly convenient. However, credit card processing fees may mean that paying with a credit card is less cost-effective than other payment options. In addition, the CBN crypto ban means that currently, it is not possible to buy Bitcoin (BTC) and other crypto assets using naira domiciled cards.
Bank transfer or deposit: Many Nigerians have resorted to buying cryptocurrencies via bank transfer in order to circumvent the current regulations. Peer-to-peer(P2P) exchanges allow crypto merchants to accept payment via bank transfer. This method is also one of the cheapest ways to purchase cryptocurrencies, as it involves a direct purchase. Binance and Bundle are two platforms that enable Nigerians to buy cryptocurrencies using this form of payment.
Cash payments: If you want to buy crypto using naira or other fiat currencies in cash, there are several options that include:
- Using a service like LocalBitcoins in order to find a local vendor who will accept a cash payment
- Locating a Bitcoin ATM and buying directly. Note that Bitcoin ATM fees are significantly higher than those for other purchase methods.
Step-By-Step Guide to Buying Crypto in Nigeria
As a general rule, you can buy cryptocurrencies in Nigeria by following these three steps, regardless of which platform or service you use.
1. Choose a Crypto Wallet
To store the cryptocurrency you purchase, you must have access a crypto wallet. You can use a wallet that is naively provided by crypto exchanges or use a wallet for which only you have access to the private key. This latter option includes hardware wallets, such as Ledger Nano S, desktop software wallets, such as Electrum, or mobile apps, such as Trust Wallet.
2. Choose Where to Buy Your Crypto
There are many different crypto platforms to choose between. These can be divided into three broad categories:
Crypto brokers: Brokers support convenient payment methods, such as allowing users to buy crypto using fiat currencies. Crypto brokers usually have fiat on-ramps that integrate easy-to-use payment methods like bank transfers or debit card payments. One example of a crypto broker that supports direct naira payments is Luno.
Cryptocurrency trading platforms: These are platforms that offer users the ability to trade cryptocurrencies. Exchanges conveniently enable traders to deposit fiat currencies in online wallets that they can then use in order to purchase their desired crypto assets. You can find an overview of the best platforms available for Nigerians here. Note that some have imposed restrictions on Nigerian residents in the wake of the CNB ban.
Peer-to-peer exchanges: P2P exchanges enable direct negotiations between individuals. Buyers are matched with sellers who specify their price and accepted payment methods. Once a transaction is initiated, the funds are held in an escrow system until payment is confirmed by the seller. This method offers greater privacy. Platforms that Nigerians can use peer-to-peer include LocalBitcoins and Binance.
3. Purchase Crypto
The last step is to purchase your desired cryptocurrency. For beginners, it is ideal to buy from a broker or an exchange that supports naira payments.
For most centralized platforms, you will first need to create an account. Depending on the platform and where it is registered, you may also need to provide data and personal information as part of a Know Your Customer (KYC) process.
The KYC process includes verifying your identity with a valid identification document. This must be done before most platforms will allow you to make a purchase. Once your account has been verified, you’ll need to choose which cryptocurrency you wish to purchase and how much, as well as which payment method you’d like to use. Make sure to review the total cost for the transaction, including fees, before confirming the purchase.
Where to Buy Bitcoin in Nigeria
Bitcoin’s meteoric price rise in 2020 and 2021 has spurred massive demand for crypto in Nigeria. A full overview of exchanges available in Nigeria is provided here. Meanwhile, some exchange and other options include:
Binance P2P: Binance has developed a P2P platform that provides a safe environment for buyers and sellers to transact at zero transaction fees. Nigerians can also access extensive crypto products, including decentralized finance (DeFi).
Bitcoin ATMs: Although there are only a handful of Bitcoin ATMs in Nigeria, they remain a good, if expensive, option for Nigerians to buy Bitcoin (BTC) and other cryptocurrencies.
Where to Buy Ether in Nigeria
Ether (ETH) is the second-largest cryptocurrency by market cap and one of the most popular altcoins worldwide. Ether has seen high demand in Nigeria due to its recent rise in value and central importance for many DeFi products. Nigerians can use P2P services to trade Ether in order to adapt to the restrictions imposed by the CBN ban.