The Bureau De Change (BDC) operators in Abuja, the capital of Nigeria, have ceased their operations due to the lack of United States dollars in the market. According to local reports, currency traders have cited the emergence of peer-to-peer (P2P) crypto exchanges as one of the reasons for their predicament.
However, Nigerian Web3 legal representative and analyst Kue Barinor Paul has dismissed these claims as unfounded, stating that virtual currencies have a negligible impact on Nigeria’s foreign exchange (forex) activities. He argued that the main causes of the forex shortage are the fluctuations in the exchange rate and the high dependence on imports.

Crypto P2P Market Offers A Cheaper And Easier Alternative
Paul explained that BDCs deal with physical cash, while crypto transactions are done online with digital assets such as stablecoins, which are pegged to the value of fiat currencies. Therefore, there is no direct competition between the two sectors. He added that blaming the crypto P2P market for the BDCs’ liquidity problem is a way of avoiding the real issues that must be addressed.
Nigeria is currently the largest P2P market in the world, a status that was achieved after the Central Bank of Nigeria (CBN) banned financial institutions from facilitating crypto transactions in 2021. However, in December 2023, the CBN issued a circular that lifted the ban and allowed banks to resume crypto services.
Many Nigerians who deal with forex face difficulties conducting various transactions through the traditional banking system. Paul noted that the fees for transferring foreign currency are much higher in the banks than in the digital assets market, making P2P transfers more appealing.
Crypto P2P Market Fosters Financial Inclusion And Innovation
Supporting Paul’s view, Nigerian crypto analyst Rume Ophi said that the crypto space enables financial inclusion, making it easier for people to access forex and protect their Nigerian naira from inflation. He also said that virtual currencies can create new economic growth and development opportunities in the country.
Paul also suggested that there are possibilities for collaboration between conventional players like BDCs and digital currency operators. However, he stressed that this would require the government to regulate both sectors and enable BDCs to leverage technology to improve their transactions.
Ophi agreed that virtual currencies need to be regulated properly, and the government needs to comprehend the actors and mechanisms in the crypto space to regulate it effectively. He said this would foster trust and confidence among the stakeholders and the public.
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