KPMG Report Urges Nigeria to Embrace Blockchain as Crypto Transactions Hit $59 Billion
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Despite the Central Bank of Nigeria’s (CBN) ban on cryptocurrency trading, Nigeria contributed an estimated $59 billion to the virtual currency market between July 2023 and June 2024, reinforcing the country’s leading role in the sub-Saharan African crypto space.
A joint report by KPMG and blockchain analytics firm Chainalysis highlights the transformative impact of crypto assets in the region, with sub-Saharan Africa accounting for $125 billion in crypto transactions during the period, 47% of which originated from Nigeria.
The report attributes Nigeria’s growing crypto adoption to its use as a hedge against economic instability. It found that 85% of the total crypto value received by Nigeria’s local exchanges comprised small retail and professional-sized transactions under $1 million, suggesting that Nigerians primarily use crypto for everyday transactions rather than speculative investments.
Additionally, the high costs of cross-border remittances through traditional banking channels have driven many Nigerians—both locally and in the diaspora—to rely on crypto as a faster and more affordable alternative for sending money.
Ban Ineffective in Curtailing Crypto Adoption
KPMG and Chainalysis noted that the 2021 CBN ban on cryptocurrency trading had unintended consequences. Instead of slowing adoption, the ban accelerated Nigeria’s prominence in the global crypto ecosystem, with the country’s share of global crypto value continuing to rise since 2021.
The report advocates for a regulatory shift, arguing that embracing blockchain technology and integrating crypto services into Nigeria’s financial system could yield benefits for both traditional banks and fintech firms. It suggests that partnering with blockchain companies would expose Nigerian banks to much-needed technological advancements while improving legacy financial monitoring systems.
The Rising Threat of Crypto Scams
While crypto adoption continues to expand, the report warns of growing fraudulent activities. It reveals that global crypto scam revenues reached $10 billion in 2024, with pig-butchering scams and high-yield investment fraud accounting for 83.4% of the illicit proceeds.
Despite these risks, KPMG and Chainalysis argue that a well-regulated crypto ecosystem in Nigeria could enhance transparency, improve security, and drive financial inclusion, positioning the country as a key player in the global digital economy.
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