A recent hike in prices of petroleum products in Nigeria may increase Bitcoin adoption for cross border transactions and other uses such as for safekeeping and investments. Compounded by rising foreign exchange rates for imports, the hike is likely to have a transparent effect on inflation which already hit a 46-month high of 12.8% in March. Bitcoin adoption grows
There has been a growing level of Bitcoin adoption in Africa’s largest economy of late though. The level of awareness about the digital currency’s uses have improved particularly for trading and online purchases.
It would seem more handy now that the disparity between the exchange rates of foreign currencies such as the US dollar to the naira has widened.
The rates charged by traditional financial institutions have not been helpful. As of Friday May 13, Western Union calculates its exchange rate for a US dollar to be 197 naira – that’s excluding the transfer charge. Whereas in the parallel market, the rate Is 345 naira . Subsidy removal stimulates the currency black market
There are speculations that the exchange rate is likely to increase soon. The government insists that the 67 percent price hike in the prices of petroleum products brought about by its sudden removal of a subsidy will not be reversed as it is aimed at tackling months of fuel shortages in the country.
The government also said petroleum product marketers who import the commodity to the country could buy dollars – which is their main currency of trade – from any source rather than just the Nigerian central bank or oil companies. This is the caveat that gets many worried.
Victor Asemota, Co-Founder/Director at SwiftaCorp wrote on his twitter page: “Now that fuel marketers can get dollar from anywhere to buy product but sell in Naira, the demand […]
