Experts have revealed that more Nigerians prefer to trade cryptocurrencies such as bitcoin, Ethereum, Litecoin, Bitcoin Cash, etc, than use them as a means of exchange.
The experts were speaking at the Luno Meetup which held in Abuja on Saturday, 30 March, 2019. Owenize Odia, country manager of Luno Nigeria announced that the company plans to begin a monthly trading webinar to enable beginners across Nigeria learn more about the market; the benefits and the pitfalls.
Cryptocurrencies have become very popular in Nigeria driven by the proliferation of exchanges. Nigeria has the highest number of cryptocurreny exchanges – about 12 in operation – in Africa. Luno is one of the top three exchanges that have fuelled adoption of the non-bank financial product powered by blockchain and attracted investors’ fund as well. Data from CBInsights showed that investors staked $232 million in blockchain and bitcoin companies in the second quarter of 2017. That number is set to be doubled in 2019.
Given its potential to bring in additional revenue, cryptocurrency trading now accounts for the most activity on many exchanges. Armed with a cryptocurrency wallet and an exchange that allows him or her buy and sell, anyone can begin their journey as traders.
Olaleye Awe, a notable cryptocurrency trader and trainer said the market could be tricky and a pose little inconvenience for first time traders.
“Trading cryptocurrencies is a 24/7 market; every day of the year you can make money and you can also lose money,” says Awe who is popularly called ‘Prof Awe’. “It is important that you are aware of what the market can give you.”
Awareness remains the only constant while trading any cryptocurrency. He recommended that first time traders should start with well-known wallets like the Luno Wallet and prominent coins like bitcoin and Ethereum.
A good first foray into cryptocurrency trading is the obvious, buying a major cryptocurrency like bitcoin. After that, the trader will probably want to trade naira for crypto on an exchange like Luno. Once that is done, the trader can then try Bitcoin and Ethereum for other cryptocurrencies.
The market volatility is a well-documented fact and can be a double edged sword. Awe believes the right time to buy is usually when there is a major drop and sell when the market is bullish. The mentality of the trader should be focused on making profit.
“Anytime profit is showing on your bitcoin, take it. It doesn’t have to be big profit, small profits add up over time. The only way to get rich in trading is through your compound interest. If you do 20% of N1,000 in 60 trades, you will make N1 million,” he said.
Lucky Uwakwe, co-founder of Cheetah Africa and COO at Blockchain Solutions Limited noted that issues around high volatility and cyber criminality are partly behind the regulators stance on cryptocurrencies. At the moment, the Central Bank of Nigeria has taken a neutral stand while it considers – through a special committee – how to regulate the market.