Many Nigerians are experiencing difficulties in finding the right place to buy their first crypto. It is easy to get lost, given how much this space has expanded in the last few years and how many options are on the table now. Some are evidently better than the others, but it’s not always as easy to figure them out.
Let’s explore what these options are and where the real choice lies.
You can acquire cryptocurrency by paying for it with fiat (for example, with the Nigerian Naira or any other fiat currency) or by converting into it some other crypto (for example, Bitcoin into Ethereum and vice versa).
Your choice ultimately determines the best method to put a few coins into your wallet, but the most popular channels through which to gain exposure to this market include:
As a quick aside, crypto is not just about Bitcoin, but Bitcoin remains the numero uno coin to look for.
Payment systems usually don’t offer a legion of options in respect to how many cryptos they support. Your choice is always limited to a select few coins, and more often than not, Bitcoin is the only option to enjoy yourself with.
Their undoubtful advantage, however, lies in the fact that a fiat payment system necessarily supports the national currency of the country it operates in, and likely a bunch of other currencies as well. For example, BitPesa, a remittance platform with roots in Kenya, offers a Bitcoin option for Nigerians, who can buy this coin with Naira.
You can’t trade crypto with a payment system similar to an exchange, but if all you need is to buy Bitcoin, they do pretty well (provided they support the option).
Centralized exchanges enable their users to trade crypto either for fiat or for another crypto. There are advantages as well as disadvantages fundamental to this option – taken on their own or in comparison with other options.
On the plus side, top cryptocurrency exchanges (for example, Binance) offer a huge choice of trading pairs with which you can buy and sell Bitcoin for both fiat and cryptos at the market price with little or no slippage. Trading fees are also pretty attractive on centralized exchanges, and sometimes you can enjoy trading with no fees charged at all.
On the downside, you have to deposit fiat on centralized exchanges if you want to buy crypto with it. And that exposes you to all kinds of nasty things that could happen to your hard-earned money, like sneaky account freezes or outright money grabs.
Not that your coins are inherently safe there, but they are not safe anywhere unless you own the keys to your cryptos.
Decentralized exchanges (aka DEXes), on the other hand, make a point about trades occurring right on the blockchain without the involvement of any third parties – for example, their centralized twins as in the part above. It is implicitly assumed that your funds are safe at all times, but we’ll see.
The main flaw of decentralized exchanges is that you can only trade assets that exist on the blockchain used by a certain DEX. For example, on Ethereum you natively trade Ethereum assets, so instead of buying Bitcoin, you only buy an Ethereum token representing it.
Now, it becomes a matter of trusting whoever happens to issue and redeem these tokens for the real thing.
Decentralized exchanges are likely not the best place to buy crypto when you want to build a diversified portfolio of cryptocurrencies, starting with Bitcoin itself. And still more so when you are going to do it with real fiat (that is, not some wrapped version of it).
Then, the only advantage you can get with a DEX like Uniswap worthy of mention here is anonymity.
But you can easily get that on a peer-to-peer marketplace.
In terms of cryptocurrencies that you can buy with fiat, peer-to-peer (p2p) marketplaces are on par with centralized exchanges. Typically, you can buy a few major cryptos like Bitcoin and Ethereum on these platforms, and pay for them using regular payment methods such as bank transfers and debit/credit cards.
Because users on a p2p marketplace trade directly with each other, the money moves from the buyer of cryptocurrency to its seller without any involvement, let alone intervention, on the part of the marketplace.
Consequently, it is impossible to lose funds due to reasons that are commonplace on centralized exchanges (though your coins are still vulnerable).
Further, p2p marketplaces are not as much susceptible to crypto bans by the financial authorities as their centralized rivals. In countries where cryptocurrencies have been outlawed (one way or another), many centralized exchanges had to halt all their operations – only to give way to p2p platforms, which are thriving in this environment.
But they are not without their weaknesses, either, as many marketplaces only allow trading crypto for fiat. So if you want to exchange one crypto for another, you may be out of luck.
Now let’s turn to Bitpapa, a global p2p marketplace with a growing presence in Nigeria.
Bitpapa aims to provide all types of users around the world with easy access to cryptocurrencies. Recently the marketplace added support for Naira, and that makes it one of the not-too-many places where Nigerians can buy Bitcoin with their national currency (along with Ethereum, TON, Monero and USDT).
As explained earlier, p2p platforms don’t transact in fiat – it is Bitpapa’s users who pay each other directly without the marketplace’s involvement. Bitpapa only handles cryptocurrency transactions to, from and within the platform, using cryptocurrency to secure trades.
The idea is really simple to grasp.
When the buyer opens a trade with the seller, the required amount of cryptocurrency is locked in the escrow wallet of the marketplace, making both counterparties honor the terms of the trade and either go through with it in full or get back to square one.
In this way, the seller cannot rip the buyer off and withdraw the coins from the platform once he receives the payment from the buyer. And if he tries to back out of the deal after the buyer has already paid him, the marketplace resolves the ensuing dispute. Anyway, the honest seller is expected to release the coins from the escrow without Bitpapa stepping in.
Further, the buyer can only expect to receive the coins after he actually makes the payment and the seller confirms the arrival of the money into his account.
It is either everyone wins or no one loses.
The Nigerian users of the platform can now fully enjoy the safe and secure trading environment the service offers. And they can do that by employing the following payment methods available in Nigeria:
Since buyers pay sellers directly, Bitpapa allows you to use an array of payment methods that are specific to Nigeria. For example, you can use Chipper Cash, a payment system which provides services across a number of African countries (including Nigeria):
As long as a legitimate proof of payment for a payment method can be obtained and submitted (anything similar to a bank statement), new payment methods can be added to the list of payment options supported by Bitpapa.
If you don’t find the one you are looking for or would like to use, let Bitpapa know.
Unlike many other exchanges and marketplaces, you are not immediately exposed to the requirement of identity verification after you sign up with the platform. Verification is optional on Bitpapa, and unless you want to trade with users who require that from their counterparty (read, yourself), you are free to remain anonymous.
And referring to one of the major shortcomings of p2p marketplaces (lack of crypto-only trading pairs), Bitpapa is developing a service that would extend the functionality of the marketplace and allow users to instantly swap one cryptocurrency for another.
Then you won’t need to use fiat at all.
Bitpapa strives to make cryptocurrencies simple enough to be understood by people who are not traders. To achieve this goal, it offers a p2p trading platform which doesn’t require an expert-level knowledge of either cryptocurrencies or trading. At the same time, it is powerful enough to meet the needs of the most experienced and demanding crypto enthusiasts.
This is where to buy crypto in Nigeria and across the world.
Q: Where Can I Buy and Sell Bitcoin in Nigeria?
A: The most popular options are centralized exchanges (for example, Binance) and p2p marketplaces (for example, Bitpapa)
Q: What Is the Cheapest Way to Buy Bitcoin?
A: Many exchanges and p2p marketplaces offer zero-fee trading, so it all comes down to deposit and withdrawal fees for both fiat and crypto
Q: Where Is the Safest Place to Buy Bitcoin?
A: All things considered, peer-to-peer marketplaces are the safest place to buy Bitcoin
Q: How to Safely Buy Bitcoin?
A: Find a trusted seller on a p2p marketplace and make a trade with them using one of the supported payment methods