Economy
The Impact of Digital Asset Trading Market on Nigeria’s Economy
What are Digital Assets?
Digital assets are simply items whose content is stored in electronic format.
With that definition, you would most likely be thinking about images, music, movies, documents, etc. The truth is, those indeed are digital assets. Thanks to technology, these assets have developed far beyond that, and are also digital currencies.
What Are The Types of Digital Assets?
Based on this article, I would be focusing on two major types of digital assets which serve as a source of money. Gift cards and cryptocurrencies.
Gift Cards
Gift cards or gift certificates are a type of debit card, pre-loaded with a specific amount of money that could be used for a variety of purchases at a designated brand.
Gift cards serve as alternative sources of payment at designated brands. For example; A $100 Amazon gift card could be redeemed to make purchases online or any of the multiple Amazon stores located in the United States.
These cards are also excellent presents to give a loved one on their special day. When a birthday, wedding anniversary, baby shower, graduation, etc is coming up, gifting your loved one a loaded gift card from their favourite brand would always put you in their good books.
Presently, the numerous gift card brands could not all be possibly be listed. However, some of the notable and familiar names include; Amazon, Itunes, Steam, Walmart, Apple, Google Play Gift Cards, etc.
Cryptocurrencies
What are cryptocurrencies?
Cryptocurrencies are Binary data that were designed to serve as a means of exchange of goods and services. Created with the use of blockchain technology, these coins are secured by Cryptography.
Currently, there are over 10,000 coins in the crypto market. You should be familiar with certain names like Ethereum, Bitcoin, Tether, etc.
Evolution of Digital Asset trading in Nigeria
To those who are just getting accustomed to digital asset trading in Nigeria, you should consider yourselves lucky. There is a very huge difference between what it is now and what it was back then.
A couple of years back, most Nigerians were not familiar with this concept. A crypto or gift card holder in Nigeria, wanting to exchange his asset for cash was practically embarking on an impossible mission here.
It was just not feasible. This was not a result of the difficulty of this process per se, but the awareness, There were a lot of dark clouds regarding these assets here in Nigeria, and as a result, people felt very hesitant to own or collect them. With very little demand for this service, there was no incentive for individuals to provide supply.
How did we get here? you may be wondering. Thanks to certain trading platforms that decided to pioneer the movement, the market was able to grow over the years.
The founders of these early platforms also witnessed the vast scarcity in the market and knew that they most likely won’t be the only ones going through this. They leapt and decided to create a solution to this problem without ripping people off.
Word got around, and many other Nigerians developed the confidence to trust these platforms with their assets. As the demand for this service started growing rapidly, other entrepreneurs saw the opportunity and decided to enter the market.
In Nigeria, what was once perceived as a myth, is not only possible but has been made very simple.
The Impact of The Digital Asset Trading Market on Nigeria’s Economy
Another important aspect to look at after the evolution of this market is its impact. Has this market affected Nigeria’s economy Positively or negatively?
I believe that everything in life has its pros and cons. It would be up to you to decide if the pros outweigh the cons for you or vice versa.
Since the introduction of digital asset trading on a national level, Nigerian citizens have enjoyed the ease of transactions. Day-to-day activities such as payments and exchange have been made simpler and faster amongst Nigerians and even beyond.
The increase in patronage of this service has profited such platforms, which has led to its continuity and expansion. This act has employed various intelligent Nigerians.
This market has also aided international business transactions between Nigerians and individuals and companies in the diaspora.
For example, a graphics designer or web developer working remotely in Nigeria could be freelancing for a company located in America and receive payment straight to his BTC wallet or the equivalent in gift cards, which saves the several hassles faced in the banking halls or waiting for hours or days for the money to arrive from outside the country.
With the massive rise in demand for this service, unfortunately, there was also an increase in digital asset scams in the market. Crypto and gift card owners have fallen victim to these scammers throughout exchanging their assets for cash.
Quite frankly, this would only happen when adequate research is not conducted. With money, you should be patient. There should be enough background checks done with whoever you are entrusting your money with. Till today there are still various victims of BVN and real estate scams. This would not stop us from using our traditional banks or buying and renting properties.
There are still legitimate exchange platforms to sell gift cards in Nigeria which could be used to avoid scams.
By Adedapo Adesanya
Three stocks further weakened the NASD Over-the-Counter (OTC) Securities Exchange by 1.12 per cent on Wednesday, April 8, with the Unlisted Security Index (NSI) down by 44.43 points to 3,930.91 points from the previous day’s 3,975.34 points, and the market capitalisation went down by N26.59 to N2.351 trillion from N2.378 trillion.
MRS Oil lost N11.00 during the session to close at N161.00 per share compared with Tuesday’s closing price of N172.00 per share, Central Securities Clearing System (CSCS) Plc dipped by N3.74 to N67.95 per unit from N71.69 per unit, and Afriland Properties Plc fell by N1.10 to sell at N15.95 per share versus N17.05 per share.
There were two gainers at the midweek trading session, led by IPWA Plc, which appreciated by 55 Kobo to N6.61 per unit from N6.06 per unit, and First Trust Mortgage Bank Plc improved its value by 4 Kobo to N2.32 per share from N2.28 per share.
Yesterday, the volume of securities rose by 620.4 per cent to 5.7 million units from 797,264 units, the value of securities increased by 25.1 per cent to N32.7 million from N26.1 million, and the number of deals climbed by 12.1 per cent to 37 deals from the preceding session’s 33 deals.
Great Nigeria Insurance (GNI) Plc ended the day as the most traded stock by value on a year-to-date basis with 3.4 billion units sold for N8.4 billion, trailed by CSCS Plc with 57.2 million units exchanged for N3.9 billion, and Okitipupa Plc with 27.5 million units traded for N1.8 billion.
GNI Plc also finished the session as the most traded stock by volume on a year-to-date basis with 3.4 billion units valued at N8.4 billion, followed by Resourcery Plc with 1.1 billion units worth N415.7 million, and Infrastructure Guarantee Credit Plc with 400 million units transacted for N1.2 billion.
By Adedapo Adesanya
Foreign Exchange (FX) demand pressure eased on the Naira on Wednesday, April 8, in the Nigerian Autonomous Foreign Exchange Market (NAFEX) after gaining N14.84 or 1.07 per cent against the greenback to quote at N1,371.82/$1 compared with the previous day’s N1,386.66/$1.
Also, the local currency appreciated against the Euro in the same market window at midweek by N1.54 to close at N1,604.07/€1 versus Tuesday’s closing rate of N1,605.61/€1, but lost N6.26 against the Pound Sterling to trade at N1,844.83/£1 versus N1,838.57/£1.
In the parallel market, the exchange rate of the Naira to the US Dollar remained unchanged yesterday at N1,410/$1, according to data sourced by Business Post.
There were indicators that the official FX market experienced a liquidity surge, which eased worries around the dominant US Dollar on Wednesday, as the Central Bank of Nigeria (CBN) revealed interbank deals rose to 220 from 71 reported the previous day.
The domestic currency has been in strong demand from foreign portfolio investors seeking to purchase OMO bills and other fixed-income instruments.
Forecasts also show that the local currency will remain relatively stable during the second quarter of the year, trading within the N1,340 to N1,430 per Dollar band on improved FX liquidity, stronger oil earnings, and rising external reserves, which have climbed above 50 billion dollars.
As for the cryptocurrency market, it fell after an initial ceasefire-fueled rally, with markets retracing Wednesday’s “ceasefire euphoria” as cracks emerge in the US-Iran truce while the Strait of Hormuz remains effectively closed.
Global risk assets face renewed pressure as geopolitical uncertainty combines with what analysts call “uncoordinated tightening” by major central banks, reinforcing higher-for-longer interest-rate expectations.
The price of Cardano (ADA) fell by 4.7 per cent to $0.2500, Ripple (XRP) slumped 3.7 per cent to $1.33, Dogecoin (DOGE) shrank by 3.5 per cent to $0.0915, Binance Coin (BNB) slipped 2.6 per cent to $600.02, Ethereum (ETH) went down by 2.5 per cent to $2,183.82, Solana (SOL) dipped 2.5 per cent to $82.24, and Bitcoin (BTC) depreciated by 1.1 per cent to $70,995.20.
However, TRON (TRX) appreciated by 0.4 per cent to $0.3173, while the US Dollar Tether (USDT) and the US Dollar Coin (USDC) remained unchanged at $1.00 apiece.
By Dipo Olowookere
The Nigerian Exchange (NGX) Limited rallied by 0.28 per cent on Wednesday despite weak investor sentiment, as the bourse ended with 18 price gainers and 38 price losers, implying a negative market breadth index.
The growth recorded yesterday by Customs Street was influenced by the 2.11 per cent rise posted by the energy index, and the 1.79 per cent jump achieved by the banking sector.
The other sectors experienced profit-taking, with the consumer goods losing 1.07 per cent, the insurance counter down by 0.36 per cent, and the industrial goods space down by 0.19 per cent.
Universal Insurance chalked up 10.00 per cent to sell for N1.21, Omatek improved by 9.78 per cent to N2.47, VFD Group expanded by 9.71 per cent to N11.30, CWG appreciated by 9.64 per cent to N21.05, and Livestock Feeds gained 9.56 per cent to close at N7.45.
On the flip side, UPDC REIT lost 10.00 per cent to settle at N6.75, Fortis Global Insurance shed 9.92 per cent to quote at N1.18, Deap Capital depreciated by 9.85 per cent to N5.40, Chams went down by 9.47 per cent to N3.06, and Japaul declined by 8.82 per cent to N3.10.
Yesterday, the All-Share Index (ASI) went up by 562.43 points to 202,585.53 points from 202,023.10 points, and the market capitalisation advanced by N389 billion to N130.404 trillion from N130.015 trillion.
During the session, 1.0 billion stocks worth N40.6 billion exchanged hands in 52,723 deals compared with the 1.1 billion stocks valued at N40.3 billion executed in 78,006 deals a day earlier, indicating an uptick in the trading value by 0.74 per cent, and a shortfall in the trading volume and number of deals by 9.09 per cent and 32.41 per cent apiece.
The activity chart was led by Access Holdings, which sold 233.0 million units valued at N6.1 billion, Fidelity Bank exchanged 113.1 million units worth N2.2 billion, Wema Bank recorded a turnover of 103.3 million units valued at N2.7 billion, Zenith Bank transacted 60.6 million units for N6.5 billion, and Chams traded 47.5 million units worth N154.6 million.
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