Nigeria’s Cash Chaos Is Reaching A Boiling Point, Underscoring Need For Bitcoin
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As Nigerians protest over the inability to withdraw cash, it should be clear that the country needs a Bitcoin alternative.
This is an opinion editorial by Ray Youssef, a founder and CEO of Paxful and a founder of the Built With Bitcoin Foundation.
The cash crunch in Nigeria is reaching a boiling point as 54% of its currency is out of circulation. Earlier this month, I wrote about the deadline for turning in the old naira (₦) banknotes, the scarcity of the new redesign and the lengths people have had to go to get their hands on the new currency.
But A Lot Has Changed Since Then
Lines have turned into protests and people are at their breaking points. This chaos stems from confusion. People do not understand who to turn to as they hear different stories from the Nigerian federal government, the supreme court, the Central Bank of Nigeria (CBN), some state governments and the banks.
Last week, the Supreme Court announced that the old ₦200, ₦500, ₦1,000 notes were valid until February 22 — when the court will pick the case for a full hearing. The next day, Nigerian President Muhammadu Buhari ordered the CBN to allow the use of old ₦200 notes until April 10. From the president, this leaves the old ₦1000 and ₦500 notes out of circulation. Some state governors are siding with the supreme court over the federal government and the CBN. As examples, governors in Lagos, Kaduna and Ogun have openly encouraged Nigerians to continue using the old ₦200, ₦500 and ₦1,000 notes.
On top of this confusion, the CBN has run out of paper to print the newly-redesigned notes and some believe that banks have been hoarding new banknotes — only giving access to the rich and people with connections.
This Has Caused Chaos
Major roads in Ibadan, Oyo State, were blocked by bonfires and protests over the delay of the new notes. In Warri, Delta State, people have taken to the street, burning ATMs as a last resort. In the Ojota area of Lagos, a fight broke out between commuters and motor park workers over collecting the old naira notes. I can feel their desperation and unrest — it’s what I felt when I was marching in Tahrir Square against corruption in the 2011 Egyptian revolution.
This money isn’t play cash. Nigerians need naira to buy food from the market and to use it as fare to get into work. Their whole lives have been disrupted. And all of this is coming less than a week away from the country’s 2023 general election. I pray that the election is still able to run this Saturday and that people are able to vote safely.
My Hope For The Future
The suspected ease of centralized currency breaks apart when you see what’s happening in Nigeria. It’s a terrible situation and a sad but real use case for Bitcoin.
My plea is to get more attention to what’s happening in Nigeria. I love this Bitcoin community and I hope this opens up more eyes to why countries like Nigeria desperately need another alternative — not because they need another investment asset, but because their future is riding on its success. I hope we can all stand with the people of Nigeria as they push for change and prosperity.
This is a guest post by Ray Youssef. Opinions expressed are entirely their own and do not necessarily reflect those of BTC Inc or Bitcoin Magazine.