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November 24, 2024
Crypto

Bitcoin premium hits 60% in Nigeria as it limits ATM cash withdrawals

By akohad Jan30,2023

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The price of Bitcoin (BTC) in Nigeria has skyrocketed to well above market levels amid continued efforts by the central bank to push its citizens into digitalized cash.

At the time of writing, the price of 1 BTC on Nigerian crypto exchange NairaEX is currently 17.8 million Naira, equating to a whopping $38,792.

This represents more than a 60% premium over the current market price of Bitcoin, which is around $23,700 at the time of writing.

It comes as the Central Bank of Nigeria has continued to impose limits on ATM cash withdrawals amid an ongoing effort to accelerate its shift to a cashless society.

Earlier this month, the central bank imposed a limit on cash withdrawals following a December announcement.

As of Jan. 9, citizens were only allowed to withdraw a maximum of 20,000 NGN (around $43.50) from cash machines (ATMs) per day with a limit of 100,000 NGN (roughly $217).

The move also came just days before new Naira banknotes went into circulation with the aim of curbing inflation and money laundering. The central bank imposed a deadline of Jan. 24 for Nigerians to exchange their old higher denomination bank notes for the new currency.

However, people suffered long queues amid complaints that there was insufficient time to meet the deadline. The central bank has now extended that deadline to Feb. 10 according to reports on Jan. 29.

It is not the first time the Bitcoin premium has surged in Nigeria. In February 2021, the central bank banned regulated financial institutions from providing services to cryptocurrency exchanges in the country. This drove the BTC premium as high as 36% at the time.

Related: Nigeria set to pass bill recognizing Bitcoin and cryptocurrencies

The recent interest in Bitcoin has also seen Nigeria becoming the leading country for Bitcoin web searches, according to Google Trends.

Additionally, on Jan. 26 Reuters reported that the Central Bank of Nigeria launched a domestic card scheme to rival foreign cards like MasterCard and Visa.

The “AfriGo” card scheme was designed to give Nigerians better access to bank card services and circumvent often expensive foreign card fees and exchange costs.