Bitcoin and cryptocurrency scams have been an essential worry for the greater part of the governments around the globe. By following the old-school precautions, Nigerian traders control the bitcoin scams where traders make informal groups and conduct a backgroup verification.
Digital currency initially started in Nigeria with a scam. Mavrodi Mondial Moneybox or MMM was a Ponzi scheme that began from Russia while roping in a huge number of Nigerians from late 2015 to 2016 end. This scheme accompanied a guarantee of 30% return in as little time as 30 days. At the point when the government began descending on its bank account, MMM cut out the banks and requested that the investors utilize Bitcoins. Toward the end of 2016, MMM suspended its payout and robbed around 3 million individuals in Nigeria.
Regardless of the scams, individuals trusted that bitcoin is the future.
As indicated by Lucky Uwakwe, co-founder of the Blockchain Solutions Ltd. a cryptocurrency firm in Lagos:
“It was MMM that made Nigerians understand how Bitcoin worked.”
In contrast with the bitcoin exchanging of about $300,000 every week, a year above, today Nigerians are trading roughly $4.7 million seven days in bitcoin.
According to David Ajala, who runs the digital currency trade Naira in Nigeria:
“The growth has been crazy. It took us two years to get 10,000 customers. Within the last year, we’ve added 90,000.”
Frequently, Nigerians experience difficulty utilizing their credit cards at foreign online traders. Because of a high extortion rate in Nigeria, a large portion of the online stores don’t process a payment from a Nigerian card. Subsequently, bitcoin has turned into an appealing choice here. There aren’t any costly chargebacks with bitcoin and based on transaction origin, it can’t be blocked. The dominant part of Nigerians keep it as an alternative asset class by utilizing it as a store of value.
As of late, numerous developing market currencies are battling against the US dollars. With a specific end goal to fence against depreciation, investors are putting a little segment of their investment into cryptocurrencies.
Bitcoin scams are normally those plans that request next to zero membership charges with the guarantee of sky-high returns. Like some other Ponzi scheme, the early investors get paid with the money of most recent investors. Since they generally depend on existing investors joining new ones, when new investors quit coming which is unavoidable, the scheme flops.
In Nigeria, the scams take after an example where the objective is being requested to wire over naira, the local currency, in return for bitcoins.
Bashir Aminu, a bitcoin enthusiast and a digital security expert in Lagos, says:
“Everybody I know has been scammed in one way or another.”
Not at all like other bitcoin hubs, Nigeria has begun developing informal traders’ group and take after the old school way to verify transactions. Aminu has begun setting up an informal trade on Telegram where in the event that others need to join the group, they need to go through the audit strategy. The security methodology may likewise include up close and personal association for bitcoin exchange.
This informal trading of digital currency has expanded the size of Nigeria’s market. Aminu, the digital security expert in Lagos ask others to purchase bitcoin and elucidates:
“If you don’t take a risk, you can’t get anything. And if it’s going to be the future of currency, then you better start now.”