Category Archives: Nigeria

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Paxful Facing Accusations of Fraud in Nigeria After Suspending User Accounts

Peer-to-peer (P2P) payment logistics platform Paxful is under scrutiny after being accused of defrauding thousands of Nigerian clients of funds accumulated from online trade in digital currencies.

The company has gained popularity on the African continent, principally due to P2P becoming the preferred trading method and also the multitude of ways cryptocurrencies can be purchased on its platform. Unlike many other regions around the globe, cryptocurrencies such as Bitcoin have very little speculative value in Africa. With local currencies often struggling, cryptocurrencies are often simply used as payment for goods or transferring funds as a more viable and reliable alternative to local fiat.

However, all is not well according to the United Global Resolve for Peace, who has forwarded a claim to the Economic and Financial Crimes Commission that Estonian-based Paxful has suspended the accounts of Nigerian subscribers effectively barring them from access to their funds.

The petition claims that there is no evidence that the Nigerian clients have been involved in any illegal activity which might in some circumstances result in accounts being shut down:

“A few days ago, our organisation was approached by some Nigerians who complained bitterly that Paxful Incorporated, the company that owns the online cryptocurrency trading and exchange platform, ‘https://paxful.com’ has been ripping them of their life investment in cryptocurrency by suspending their accounts, deactivating their wallets and refusing to return the value in their accounts to them even after investigation and finding that they were not involved in any fraudulent activities.”

One victim, who suggested that the total of Nigerians now using the platform has risen to over three million, claims he approached Paxful Managing Director, Ray Youssef, after being denied access to his USD 60,000 balance only to be told that he had created a false profile online, a charge he denied.

In response to the claims Paxful states that it only shuts down accounts which are suspected of being used illegally, claiming:

“All accounts that have been shut down have a reason for it. We will not shut down any account unless they violate our TOS (Terms of Service).”

The Economic and Financial Crimes Commission has said that it intends to follow up the petition to investigate the fraud allegations against the company.

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Ghana Mulls Positive Crypto Legislation

Ghana Mulls Positive Crypto Legislation

There are indications in some cryptocurrency circles in Ghana that its Securities and Exchange Commission (SEC) may be prepared to release its stranglehold on the space, which currently doesn’t allow trading.

This would represent a major turnaround though, given that currently all businesses are banned from conducting cryptocurrency transactions in the African nation. This despite Paxful, the world’s leading cryptocurrency-marketplace, claiming that business is currently booming.

A Paxful report just last month indicated that both Nigeria and Ghana are propping up African transactions which are currently generating USD 64.3 million per month, putting the two countries alongside the world’s top 10 markets, such as the US and the UK.

The hope is that the SEC lifts the ban and creates an environment where legitimate companies are able to thrive without going underground. However, the regulators’ deputy director general Paul Abadio argues against the SEC’s case but hints at change:

“When you choose to go there, you are on your own. We have adopted a wide range of changes on it and we are still doing our research and gathering information, and we welcome any input that people might have to help us formulate a view on how we should deal with it in Ghana.”

A fact that the SEC is still formulating a view has given rise to local crypto analysts beginning to think a positive change for the industry in Ghana could be on the way. 2018 was very much a headache year for the Ghanaian SEC who claimed that many crypto-related businesses chose to “play around” with clients money having no intention of registering their services.

With many investigations still underway into companies who may have infringed Ghana’s financial regulations, it seems very much a “wish and hope” situation at present. However, other countries on the African continent are coming at cryptocurrency from a complete direction, such as Cameroon’s independent movement boosted by an ICO and its own cryptocurrency, the AmbaCoin.

 

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Nigerian Crypto Association Asks Government for Clear Guidelines

The Electronic Payment Practitioners Association of Nigeria (E-PPAN) is asking government regulators in the country for clearer guidelines to drive the industry forward.

This follows reports, including a statement by E-PPAN, that there is a growing possibility of fintech businesses offering blockchain services being driven overseas unless both the Nigerian government and the Central Bank of Nigeria can offer clarification on its view towards cryptocurrency.

A new Nigerian blockchain hub was announced by the government in August in conjunction with UK blockchain firm Coinfirm. The resulting launch of the Africa Blockchain Lab promises to offer financial inclusion to many Nigerians outside of the country’s financial system and also to attract new startups as part of the country’s drive to support the adoption of blockchain and cryptocurrency technologies in the continent.

However, the Bitcoin Exchange Guide claims that Central Bank governor Godwin Emifele has done little to encourage the growth of cryptocurrency; investors continue to be reluctant owing to the government’s lack of guidelines. Despite the launching of the Africa Blockchain Lab by state-backed KAD ICT Hub, cryptocurrency still struggles to receive recognition in Nigeria due to its continued links to criminal activities by authorities.

“Investments in blockchain-based financial services such as cryptocurrency are today going to Rwanda and Malta, which have provided regulatory frameworks that guide operators of the technology,” claims Ade Atobatele, founder of Gboza Gboza Technology Ltd, and member of E-PPAN.

This hasn’t stopped PundiX setting its sights on Nigeria, recently introducing Point of Sale (POS) machines which enable users to pay in Bitcoin and Ether along with the country’s local currency, the Naira. Nigeria certainly has the potential to accommodate such facilities with Africa’s largest contingent of Bitcoin holders and a population of 185 million, representing the continent’s largest population of potential users and investors. Localbitcoins is reported to have seen a trading volume of USD 260 million this year to date.

Nigeria should be looking to overseas for regulation, according to E-PPAN member Michael Kiberu, calling for regulators to look to countries such as Uganda, Switzerland, Kenya, and Japan, where cryptocurrency guidelines are clear and operate with legal status, while creating a healthy flow of capital into the financial sector.

 

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Paxful P2P Claims Africa Has the Largest Bitcoin Trade Volume

Cryptocurrency is finding its feet in Africa, as US-based P2P crypto marketplace Paxful is finding out this year with transaction numbers rocketing.

Paxful Inc. operates a peer-to-peer payment logistics platform which focuses on buying and selling of bitcoins. The company has just returned with impressive numbers after its leadership team visited Africa to assess its successes there.

The trip to South Africa, Nigeria and Ghana revealed that Africans are turning to Bitcoin in ever increasing numbers with Paxful’s transactions alone standing at R948 million ($66 million) per month. Over the past year, Paxful transactions from SA increased by 25%, by 60% in Nigeria and by up to 100% in other parts of the continent. For Africa as a whole, Paxful has seen a 225% increase in users in the last 12 months.

The South African economy is struggling but Bitcoin continues to gain popularity with investors, writes bitcoinist.com. In April of this year, the South African Central Reserve Bank (SARB) announced moves towards overseeing cryptocurrency and fintech developments in the country, suggesting rather than taking prohibitive regulatory measures, it would introduce an investigative unit which would promote growth and innovation. The South African Revenue Service also announced a new framework for cryptocurrency taxes.

As a result, cryptocurrency adoption has started growing in the region. AsiaCrypto puts Bitcoin’s continued popularity in South Africa down to the fact that some of the country’s larger asset holders are moving into crypto. “Bitcoin” is now reported to be the trending term on SA Google search.

In South Africa, Paxful is not alone, with Luno recently announcing that it now has two million users spanning 40 countries. Another South African-based exchange, Coindirect, now trades over 40 altcoins. Paxful COO Artur Schaback comments:

“As a company, we’ve learned a lot from African consumers. For instance, we’ve improved our mobile capabilities to cater to the widespread use of smartphones on the continent. Our experience in Africa has strengthened our capability to serve consumers regardless of geographical location or origin.”

In parts of Africa, cryptocurrencies such as Bitcoin have very little speculative value; with local currencies often struggling, cryptocurrencies are often simply used as payment for goods or transferring funds as a more viable and reliable alternative to local fiat.

Recently, countries such as Zimbabwe, South Sudan, and oil-rich Nigeria have all suffered from inflation, while others continue to go through it.  In these situations, it is hardly surprising that populations look to a more stable form of monetary solution in their daily lives. Paxful, like other exchanges operating for those on the African continent,  is beginning to see this groundswell feed through as Africans turn more readily to P2P cryptocurrency trading as a financial solution to everyday problems.

Ray Youssef, co-founder, and CEO of Paxful suggests Africans have been clever in dealing with financial barriers in some of these countries:

“The people of Africa were educating us. It really wasn’t just Bitcoin and Paxful–it was peer-to-peer finance. These folks were finding ways around all their barriers – whether foreign or domestic – using peer-to-peer finance… The same thing that Uber did for transportation and Airbnb did for hospitality, peer-to-peer financial marketplaces are doing for finance.”

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Crypto POS Comes to Nigeria, Reflects Global Trend

Nigeria is cashing in on its first crypto-based point of sale (POS) system which will enable users to pay in Bitcoin and Ether along with the country’s local currency, the Naira.

Globally the amount of such crypto-based POS systems is on the rise, with Indonesian payment company PundiX hugely influential in facilitating the spread. POS provider PundiX, has also recently announced a partnership with Hong Kong group FAMA to improve retailing using cryptocurrency for purchasing organic foods throughout the company’s chain.

Such solutions for mainstream consumers will simplify cryptocurrency transactions, enabling retail outlets to install their POS devices for speedy acquisition or spending of major cryptocurrencies and could become the future for both retailers and consumers.

The same company has finalized a POS deal with Brazil’s BitCapital that will see 1,000 X POS devices distributed to hundreds of retail outlets there. BitCapital states one of its main goals as creating an infrastructure network that can make cryptocurrency to fiat transactions as straightforward as it’s achievable.

PundiX’ move into the African continent is unsurprising given recent attention by fintech companies eying the opportunities for business in the sector. Michael Lawal, business development manager at PundiX, explains the simplicity of how the system works, talking a user through a demonstration of the first live transaction in the African continent:

“I have 0.01 BTC and I am going to make a transaction of 200 Naira …The cashier provides three options – to pay either with cash, XPOS card or XPOS Wallet. If you are paying with Xwallet you will need to scan a QR code…Once you choose your payment option, the cashier automatically calculates the rate of conversion using current market rates to the local currency, which is Naira. You have two seconds lock-in period to safeguard the consumer and the merchant.”

The system only takes seconds to confirm a transaction issuing an instant receipt outlining all of the details of the payment.

Nigeria could become a major fintech center given that the country holds Africa’s largest contingent of Bitcoin users and has a population of 185 million, representing the continent’s largest population of potential users and investors. Local Bitcoins is reported to have seen a trading volume of $260 million in this year to date.

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Digital Currency Ecosystem in Africa Grows, But More Connectivity Needed

A new report by the International Telecommunications Union (ITU) has outlined that Africa will need to invest more in internet connectivity in order to maintain the continent’s current pace of cryptocurrency adoption.

The popularity of Bitcoin in Africa continues to grow as a result of the presence of cryptocurrency exchange platforms. There are benefits to cryptocurrency ownership that are unique to the African continent, many devolving from the widespread unstable economic conditions.

Owning and trading in cryptocurrencies is a trend on the rise in countries across the globe. The markets in the USA and Asia have typically gained media traction, while the phenomena in Africa is left largely uncovered. Moreover, a large number of recognized exchanges don’t offer services in Africa, whereas, some recognize the significant marketplace that includes many Africans who do not have access to formal bank accounts.

If Africa is to be the next boom as many experts are currently predicting, it will need to make major changes to its telecommunications infrastructure across the continent, as indicated by the ITU report. The report shows that to connect the majority of Africans to the internet will cost as much as $450 billion.

Currently, governments on the continent spend significantly less than the global average with most countries spending three times as much on connectivity. Low education levels and the high cost of internet capable devices have been cited as contributing factors to the current slow uptake of the internet in many areas of the continent.

The uptake of digital currency has been prolific in Africa over the past two years, with many countries taking on the advantages that currencies such as Bitcoin offer over local fiat currencies. Kenya, Ghana, Uganda, Nigeria, South Africa, and Zimbabwe have all shown a significant increase in crypto adoption.

Coindirect co-founder Stephen Young says that Africa has unique problems and these must be considered in any startup plan for cryptocurrency adoption on the continent. He feels that current exchanges don’t take these into consideration. In terms of African fiat currencies, Young identifies their systemic volatility, insecurity and lack of governance as factors that the crypto space need to take on board: He argues:

“If Africans are to benefit from the cryptocurrency revolution we need make it easier to buy, store and trade cryptocurrencies. As Africans, it is our responsibility to help build the infrastructure and we need to be a part of the revolution.”

It is clear that this “infrastructure” depends on connectivity. ITU reveals that out of the 52 percent of the world’s population who remain unconnected to the internet, the majority of these live on the African continent.

One country is attempting to address this disparity. Rwanda has managed to achieve a 90 percent broadband spread with its nationwide rollout of optical fiber throughout a larger part of the country. The project began in 2009 in order to boost broadband services and attract foreign business investment.

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Nigerian Banks, US Tech Firm Tackle Financial Exclusion with Blockchain

National Nigerian banks have teamed up with US-based software development company Hashcash to combat the African nation’s widespread issue of financial exclusion through a blockchain banking implementation.

The collaboration aims to promote economic growth by banking a large number of the mainly rural residents that do not have accounts, as well as offer more efficient methods of transferring money. Right now, the primary method of delivering cash outside of towns and cities relies on bus transfers, a situation that is highly vulnerable to pillaging en route.

Across Nigeria, there is a lack of traditional bank branches and technology such as desktops for citizens to access their bank accounts. Mobile phones capable of managing blockchain wallets are, however, something most Nigerians do have in their possession, making the project to overturn economic exclusion a highly feasible solution for success.

What can blockchain banking bring Nigeria?

Blockchain banking can improve the situation for unbanked Nigerians by allowing them to make financial transactions of any size to another individual with a blockchain-backed wallet, no matter the geographical location of both parties. This adds enhanced security over traveling across the nation that is suffering from civil disruption with cash, also saving people the time they would take to physically travel.

Another benefit that blockchain provides is transparency over the movement of finances, something NGOs have been fighting for because a lack of evidenced bank transactions can hinder demographics that are attempting to move into the larger economy. Take, for example, the difficulties of renting a property in a major city without providing your banking history. Blockchain banking solutions in Nigeria have the potential to increase productivity with a nearly immediate effect while supporting the empowerment of women and marginalized communities who can not access traditional bank accounts in the country.

Blockchain in developing nations

Blockchain solutions have been touted by many experts as key in helping developing nations progress through the technology’s fundamentals of transparency, security, and accountability. David Crosbie, a lecturer at the University of Pennsylvania, said earlier this year that the decentralized technology can also bring developing states the same levels of convenience that countries such as the US take for advantage. Crosbie’s analysis focuses fundamentally on bringing trust to these societies in order to bring about progression.

 

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Nigeria to Launch State-Backed Blockchain Hub in African Crypto Surge

A new Nigerian blockchain hub is being launched by the government in conjunction with a UK blockchain firm.

The popularity of Bitcoin in Africa continues to grow, enabled by the presence of a greater number of cryptocurrency exchange platforms. There are benefits to cryptocurrency ownership that are unique to the continent of Africa, many devolving from the widespread unstable economic conditions.

Google searches reveal that , Nigeria and South Africa are frantically searching online when it comes down to cryptocurrency and Bitcoin. Many nationals fall foul of inflation and hyperinflation, resulting in weak and unstable financial systems.

Recently, countries such as Zimbabwe, South Sudan, and oil-rich Nigeria have all suffered, many of these countries with inflation rates well into the hundreds of percentages. In these situations, it is hardly surprising that the people look to a more stable form of a monetary solution in their daily lives.

Lady Victoria Walker, CEO of the United Digital Currency Reserve Foundation and UK based fintech entrepreneur feels that new technologies such as blockchain and cryptocurrency are essential factors in empowering African leaders to inject growth and financial inclusivity into their economies. She argues:

“Bitcoin is a reality. We have all major world governments scrambling to make sense of it and world leaders sharing their views on the currency. For the past 700 years, our world has relied on the European legacy banking system for means of payments and transactions. Bitcoin is definitely challenging the traditional way when it comes to the transfer of value. Just like the internet changed how we shop, bank, date and find information.”

Nigeria is looking to this kind of future with its new Africa Blockchain Lab in the Kaduna area, designed to create blockchain growth through crypto solutions across the region. The state-backed blockchain hub project between KAD ICT Hub and the British crypto firm Coinfirm wants to stake its claim as a societal changer with latter’s AMLT network offering rewards to Nigerians reporting Cyber Crime and other illegal activity online.

The Africa Blockchain Lab, launched last week has promised to offer financial inclusion to many Nigerians who are excluded from the country’s financial system and also attract new startups as part of the country’s drive to support the adoption of blockchain and cryptocurrency technologies in the continent.

As Lady Walker suggested, an understanding and deployment of bitcoin can kickstart the financial growth in Nigeria and Africa as a whole.

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Nigeria’s Poor Turn to Crypto Bounty Hunting

Bounty hunting platforms are showing that cryptocurrencies are offering a way out of poverty for some, writes Coindesk.

A bounty is a simple task or job created by a coin developer that you carry out to earn coins or tokens, usually before and during an initial coin offering (ICO). The main areas are typically Tweeting about the project, posting on Facebook, creating blog posts, designing a logo for the coin, or participating in a forum with the logo signature. These are essential jobs for the coin developer to promote their coin during the ICO stage to fund their ambitions.

As Bitcoin News reported recently, such work is offering opportunities to some that wouldn’t have considered becoming involved in the cryptocurrency industry, illustrated by women in Afghanistan now learning to write code for a bounty posting network for Ether payments.

Such sites are becoming far more visible on the net and for some, in dire circumstances, the opportunity to work for these has become a lifeline, joining companies such as Bounty0x, which now has 30,000 active bounty hunters.

Nigerian ‘Crypto Shaolin’ is one of those who has profited from the opportunity to create a new life for himself through the cryptocurrency space. He claims his life has improved, despite the recent downturn in market prices.

Shaolin’s was a soft drink seller following tourists to Africa with his box of iced soft drinks until he came upon a tourist who suggested there might be a better way of getting ahead. The rest for him is history.

Bounty0x CMO Pascal Thellmann explains:

“People in low-income countries are often excluded from global freelancing marketplaces due to a lack of formal education and banking requirements… hunters… can complete micro-tasks like retweeting a tweet or writing a review for a product, in exchange for a couple dollars in crypto.”

However, opportunities are not simply limited to working for companies such as Bounty0x, as Nigerian writer Ayobami Abiola illustrates. He claims he’s making far more money now writing by completing “bounties like article writing, posting on Reddit, Facebook like and share, Bitcoin Talk [forum] comments and joining Telegram groups for many projects”.

Crypto Shaolin is happy. He claims he’s now made USD 1,000 by collecting bounties in 2018 alone, which may not sound like a significant sum, but it’s reported to be double what most Nigerians earn in a year, with the number of Nigerians in extreme poverty increased by six people every minute.

 

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Africans Turn to Bitcoin to Beat the System

Africans are increasingly going digital as the continent undergoes a period of sustained interest in Bitcoin and other cryptocurrencies, according to Finance Magnates.

There are many reasons why Africans are beginning to turn to cryptocurrencies rather than traditional currencies. Many nationals fall foul of inflation and hyperinflation, resulting in weak and unstable financial systems. Recently, countries such as Zimbabwe, South Sudan, and oil-rich Nigeria have all suffered, many of these countries with inflation rates well into the hundreds of percentages. In these situations, it is hardly surprising that populations look to a more stable form of monetary solution in their daily lives.

The increase of technology is another contributory factor of Africa’s progression towards cryptocurrency adoption, with mobile phones now widely used across the continent, and computers becoming more a part of people daily lives, making the internet totally accessible in areas which are well serviced with providers.

Government regulation has done much to aid the crypto movement in Africa. While nations around the world are embroiled in putting crypto under the microscope, searching for ways to regulate and control the space, Africa as a whole has largely been immune from such a rigorous period of investigation and rule-making around this aspect of financial control. African exchanges have been the beneficiaries of this far more laid back to approach to government regulation.

The result is emerging blockchain developers and new cryptocurrency exchanges. Kenya-based BitPesa, a payment and transfer platform, now has 60 banks working with the company and seven mobile wallets. Another platform, Paxful, claims that African customers account for almost USD 7.5 million in transactions monthly with half of their clients being educated millennials.

Ray Youssef, co-founder and CEO of Paxful, suggests Africans have been clever in dealing with financial barriers in some of these countries:

“The people of Africa were educating us. It really wasn’t just Bitcoin and Paxful–it was peer-to-peer finance. These folks were finding ways around all their barriers–whether foreign or domestic–using peer-to-peer finance… The same thing that Uber did for transportation and Airbnb did for hospitality, peer-to-peer financial marketplaces are doing for finance.”

Youssef illustrated the African enthusiasm for crypto, describing an encounter he had with a woman who wanted to spend her last USD 20 to buy Bitcoin. She had no bank, no cards, quite typical of many Africans, but was quite happy to be guided towards a gift card and a local trader.

“I walked her through the whole transaction. That was a real eye-opener for me,” Youssef explained. “You know, us crypto-geeks think ‘oh, Bitcoin is so easy… Coinbase isn’t going to help out someone like that’.”

 

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