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Why Every Nigerian should invest in cryptocurrency

Nigeria is a country facing a difficult time.

According to 2020 data report released by International Monetary Fund’s (IMF), it’s ranked as the 27th largest economy in the world with a GDF of over 1 trillion dollars.

But things are not going great for the largest economy in Africa as it continues to climb back from wrecking economy recession that was motivated by high unemployment percentages (of about 31%), low oil and gas price, political mistrust and the damage caused by the covid-19 pandemic.

According to IMF, Nigeria inflation rate has gone up to 16.9% and believe that in the coming years under the current situation, its economic recovery is expected to be weak.

This unpredictable economic growth has forced some Nigerian investors to think beyond the scope of keeping all their hard-earned money in banks which Is most likely to suffer hyperinflation.

Rather invest in projects that will not only prevent their money from reducing in value but also yield profits over time.

There are various investments an individual can partake in.

These include Stocks, Bonds, real estate, cryptocurrency etc

In this article, we will be giving full insight into why every Nigerian should invest in cryptocurrency.

What is cryptocurrency?

“A cryptocurrency is a digital or virtual currency that is secured by cryptography, which makes it nearly impossible to counterfeit or double-spend. Many cryptocurrencies are decentralized networks based on blockchain technology—a distributed ledger enforced by a disparate network of computers”. – Investopedia

A distinguishing characteristic of cryptocurrencies is that they are normally not handed out by any central authority such as Banks, government etc

Investing in cryptocurrency is less expensive than you speculate

Investing in the crypto market is a newer path to letting your money work for you, but you don’t need to have thousands of naira to start with.

You can begin by saving up the little change you throw away by buying accessories you don’t necessarily need and investing it in crypto. It’s a practical way to build wealth in future.

One of the common investment projects for new crypto investors is Bitcoin.

Bitcoin is a cryptocurrency that anyone eager to be a crypto investor can purchase with as low as 500 Naira.

Investing in Bitcoin is considered to be the stablest and credible crypto-asset because it is backed by big institutions, with over 1 trillion dollars market cap.

Over some time, your crypto holdings will grow at an accelerating rate.

Prevent Inflation.

If you are a Nigerian acquainted with the Dollar-Naira price movement, certainly, you will know that Naira is deflating pretty bad.

Inflation, the lessened purchasing power of a currency such as Naira over time.

Inflation is the major reason why goods price has surged high and also the cause of government workers labouring 9-5 jobs still complaining of poverty.

Feranmi Adeolu, aged 56, is an Abuja based pharmacist, preparing for retirement can only count just two mistakes in his life.

One is ignoring a piece of advice by close friends years ago not to save his income in Naira. Adeolu is now filled with regret, he has seen his entire life saving reduced drastically to nothing as a result of Naira devaluation, resulting in a spike in inflation.

As a Nigerian, financially, inflation is your biggest enemy, especially when you trying to save up to buy a car, house or live a comfortable house once you retired.

The federal reserve tries to restrain the inflation rate to about 2% in developed countries such as America. Consider Nigeria, an underdeveloped country that has no efficient plan in place to mitigate the inflation rate.

Late May this year, Naira began to rise from 379/$1 to $502/$1 on 12 June in the foreign exchange market.

Feranmi Adeolu second mistake he will forever regret is that, in late January, he postponed the purchase of building materials for his business in his hometown in Ekiti, Nigeria.

In June, when he finally concluded to start the project, the price of the building materials ( sand, cement, granite ) has gone up to 30% compared to January.

This taught feranmi Adeolu a costly lesson, that naira is unpredictable, therefore not a reliable way to store one income

You can choose to invest a portion of your income into the crypto market rather than keeping all your money in a saving account.

The Crypto market is pretty new, so it’s bound to experience high volatility but still the fastest growing market in the world with over a $2 trillion market cap.
Investing in cryptocurrency with large markets such as Bitcoin and Etherum is considered a safe way to prevent Inflation

Means to Be Rich.

If you decide to invest in the cryptocurrency market to get rich, understand that there is no assurance of how your crypto assets will perform, still, it’s needless to buy the Next Bitcoin to earn a proper return on your capital.

Consider that the Crypto market has the potential to double your capital in a couple of months and you can also lose half of your investment.

Despite its volatility, the crypto market has produced a lot of multi-millionaires within a short time.

You don’t have to be a Guru.

An investor who has been in the market for so long might be better than you in predicting the outcome of a market or picking undervalue assets but you don’t have to be a brainbox, extremely rich or another Einstein to make a profit from the crypto market.

Related to investing in the stock market, the prerequisite for investing in the crypto market is quite simple, one step at a time.

Key Takeaway

Invest in assets that have a strong use case and have a large market cap. This will mitigate the volatility risk.

The prerequisite for investing in any crypto asset is dedicating hours to researching the asset you’re considering investing in.

Diversify your investment

There are over five thousand assets in the crypto markets. This implies that the market provides an option to diversify your capital in projects you believe in.

When one is investing in any sector, the diversification investment technique plays a significant role. It is regarded as a form of risk management concept.

The mixture of different assets in your investment portfolio helps to mitigate risk. since the crypto assets are exposed to unequal market volatility when one asset value goes down, another asset gains.

The diversification theory is widely utilized among investors worldwide to strategize their investment allotment.

It is proven that gains of a diversified portfolio are often greater than a concentrated portfolio.

Make a list of 10 – 50 crypto assets you believe will do great in future, you don’t necessarily have to invest in all the crypto assets within the market.

Conservative investor (an individual who aims is to achieve a steady flow of return, doesn’t need to be much, while maintaining a low degree of risk ) focus on the top 10 cryptocurrencies based on market cap.

It’s out of Government control.

This is the major reason Why Every Nigerian should invest in cryptocurrency.

The Nigeria system is so corrupt and is greatly affected by bad decision making from it’s administration.

Hence, reason why hardworking Nigeria citizens still grieve of shortage of money.

Nigeria government is built in such a way that allow the rich to get richer and poor remains poor.

This is why investing in commodity that are out of reach of the government critical.

According to an IMF report, over 40% of Nigeria citizens are in poverty

The decentralised properties of cryptocurrency enable them to exist Out of reach of government.
There are no such Government in the world that control cryptocurrency proves movement.

The Crypto Market Recognise No one.

The crypto market who favouritism to no one. It doesn’t have any program or structure of what it should behave at a particular time.

Almost anyone can become rich from cryptocurrency, No special formulas anywhere.
The difference between a profitable investment and an ineffectual investment is hours committed to research and understanding the concept.

Bottom Line