Home Markets How the Nigerian Crypto Industry is Handling the Current Bear Market

How the Nigerian Crypto Industry is Handling the Current Bear Market

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How the Nigerian Crypto Industry is Handling the Current Bear Market

It is no news that the crypto bear market, which is likened by many to a massacre, has caused a lot of instability in the space. Investments in the crypto space have slowed, participation numbers are steadily declining, and big industries such as decentralized finance (DeFi) and non-fungible token (NFT) ecosystems are seeing less and less participation on a daily basis. .

Although the cryptocurrency market has not had the best years, those building in the space in Nigeria are facing problems on two fronts. While they face the fallout from the cryptocurrency market, they also face tough economic and regulatory climates that have really hampered the growth of cryptocurrency usage in Nigeria.

While the ban imposed on banks by the CBN regarding the processing of cryptocurrency-related transactions is still in effect, the addition of the current bear market situation has caused a significant reduction in the interest of speculative players in the cryptocurrency space. A report by Boston Consulting Group (BCG), in partnership with Bitget, reveals that in terms of the size of the cryptocurrency market in Africa, Nigeria holds the second largest market, behind South Africa. Nigeria once led the way in terms of crypto market size and has seen its position taken as favorable regulations have helped other African countries to forge ahead as they embrace this new technology.

The steady fall in the Nigerian currency, the Naira, has made it even more onerous to participate in the space as P2P market operators. The only possibility to participate in the market is to trade $1 in stablecoins for over N700. While July inflation figures hit their highest level since 2005, the country’s inflation now stands at 19.64%, one of the highest in the world.

As you can see, it is already difficult to run a business in the Nigerian economy today. Now trying to run a cryptocurrency business in Nigeria with an apex bank ban and no clear regulations, the current bear market now looks like an episode of Tom Cruise’s hit movie series, “Mission Impossible”.

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Nairametrics spoke to some key players and stakeholders in the crypto space to find out how they are faring with the current bear market. Here are some of the comments we collected;

  • James Ademuyiwa – Head of Blockchain & Co-Founder, Scalex

James Ademuyiwa explained that there were some disappointments but was keen to make the most of the bear market. He explained, “As a business, we encountered some early disappointments as we were just on the verge of our first partnership with a major exchange community in Nigeria, and that community is filled with traders. The wave of the bear market hit us from this angle, and we had to sit down and redefine our strategies.

“It would shock you to know that we did the unthinkable when entering the bear market; earlier in May, Scalex raised capital from Emurgo to continue developing the first automated P2P marketplace outside of Africa. This good news then prompted us to move forward as we are more convinced that we have not built a product just for the trend or the moment, but for the posterity of Blockchain in Africa.

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“On top of that, as a company, we know we build for all seasons, so we’ve taken this opportunity to host multiple partnership and collaboration calls, which will be known to the public in a few weeks over of the last quarter of 2022. In addition, we took this opportunity to look at different areas of our users’ lifestyle, such as sports betting, to see how we can help them weather the storm smoothly and emerge profitable. .

“In conclusion, it is safe to say that we have made the best use of the bear market season while also preparing for the next bull run. Yes, it can be really dark this season, but we decided to focus on the silver lining.

He further stated that his wallet also took a beating. He said, “As a person, I’m still trying to recover from my bleeding wallet since the bear launched, but I’ve always been a HODLer, so I’m not moved by the current market conditions. . I would continue to HODL and increase my holdings of promising projects and tokens.

  • Rutherford Atayobo, CEO of Manilla Finance

Rutherford Atayobo explained that he was already prepared for the bear market as he took profits early and reinvested in other assets like real estate. He stated, “Many times when people talk about the crypto bear market, it is spoken about in stinging terms and with great disdain. We quickly forget that it was this same industry that lifted many people out of poverty in the last bull market and that the bear market is more like an inevitable market reset, giving more investors the opportunity to venture in the space.

“While I can’t say we’re happy the bear market was triggered by the collapse of the LUNA Protocol, it’s important to note that we prepared for it with the sole purpose of getting back into the market since most assets were now on sale at nearly 95% off.What could be better than that?One of the many ways we prepared for the capitulation was to take some decent profits as the market inflated and then reinvest the proceeds into other markets such as real estate and equities.This way, after the sellout, we are able to re-enter the market with proceeds from our hedging.

“So I would say we are doing very well and hopefully the Ethereum merger could create another major bull market before a long winter.”

  • Adetayo Adesola, Head of Growth, Amber Group

Adetayo Adesola explained that Amber Group is operating from a position of strength despite the current bear market. He stated, “Amber Group remains committed to the overall growth of its business following the success of a $200 million USD Series B+ funding round led by Temasek announced earlier this year. Valued at US$3 billion, I believe we operate from a position of strength amid global market volatilities.

“Over the past few weeks, the company has taken significant steps to build business resilience and protect investor assets and trust in the company by insuring assets on behalf of our clients that total coverage of more than $100 million.

“It also goes hand-in-hand with our inherent market-neutral strategy allowing clients to reap gains in bull or bear markets for our products to gain. Many clients in Nigeria are looking for a hedge against high inflation and currency devaluation and are attracted by our fixed returns on stablecoins backed by the US dollar, which is the highest in the market.

  • Harrison Obiefule, PR and Marketing Manager, FTX Africa.

Harrison Obiefule explained that although a lot of things have been put on hold, FTX Africa’s growth strategy remains the same. He explained, “I will say he is no different than any other major player in the African crypto space. A lot of things are compressed right now for obvious reasons, but our growth strategy and business goals haven’t changed. We continue to push for adoption through education, actively building our community and team, and generally laying a solid foundation on which we can build and build when the bull cycle comes around.

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