I got a phone call from the Elephant. For those who read my blog regularly, you’ll remember that the elephant stayed with me last year. I guess, as it’s a year later, he was missing me. He moved out as Spring approached, because I couldn’t stand the smell, and his constant demands for curry, crisps and cucumber. Cucumber? No idea. Anyway, he called.
Elephant: How are you doing, codger?
Me: Good, but don’t call me codger.
Elephant: What are you up to?
Me: Same old, same old. You?
Elephant: I’m great. Moved to LA and mixing with the high life.
Me: You’re in Los Angeles?
Elephant: Nah, I’m just outside Lagos.
Me: So wassup?
Elephant: Well, I thought you might be interested in what’s happening over here.
Me: In Nigeria?
Elephant: Yes! It’s a great place and I feel right at home.
Me: Well you are at home. Elephants live in Africa.
Elephant: Not so many here though. We’re almost extinct.
Me: I can’t talk about that, but COP26 might make a difference.
Elephant: Blah, blah, blah.
Me: Have you just called me to annoy me? (again)
Elephant: No! I got some news!!! (he’s very excited)
Me: Sure. It’s rained? The sun is shining? There’s a Wildebeest?
Elephant: No. Bitcoin!!!!
Me: Yawn. Heard that before.
Elephant: You’ve gotta believe brother. Bitcoin is huge here!
Me: In Lagos?
Elephant: In Nigeria. Everywhere. They love it!
Elephant: Well, no one trusts the government or banks here, so they trust the network. They trust bitcoin.
Elephant: You’ve got to come down and see it, bro. You wouldn’t just like it. You would love it.
Me: Tell me about it.
Elephant: OK, here goes. The Nigerian government banned access to foreign exchange and that left lots of folks, like my friend Moses, stuck. Moses has a business importing shoes from China. He then sells them in Kano, but the ban would make him bankrupt as he could no longer order shoes.
Me: Can you get on with it?
Elephant: Look, this is important. Moses talked with his younger brother, Osy, who had begun trading bitcoins and he showed Moses that he could still trade with China, regardless of what the Government said, by using bitcoins.
Me: I’ve heard that before, but the government has sussed that out and banned bitcoin trading too.
Elephant: No, they haven’t.
Me: Yes, they have. I saw the announcement.
Elephant: They can announce what they like. It doesn’t stop it.
Me: Tell me.
Elephant: Well, the ban just pushed a lot of trading activity underground. Moses, Osy and many Nigerians are now depending on less secure, less transparent channels, such as Telegram and WhatsApp, to trade using bitcoins and overcome the government bans on FX and crypto.
Me: Interesting. Does that mean the government is clueless?
Elephant: Aren’t all governments?
Me: But, if it’s gone underground and is unregulated, that’s gonna be an issue for Moses and Osy.
Elephant: True, but they’re happy because the regulators now have a reduced level of visibility and control.
Me: Are you a libertarian?
Elephant: No. I’m a liberstate.
Me: What the hell is a liberstate?
Elephant: Where freedom and control are balanced.
Me: You would come up with that, wouldn’t you?
Elephant: You know me. I’m a chillephant.
Me: Stop making up words.
Elephant: You wanna come over and see what’s happening over here?
Me: I can’t, due to COVID. Talking of which, how did you get to Nigeria when there’s a pandemic and no one is flying?
Elephant: I’m an airyphant.
Me: Stop making up words.
Elephant: Just banter, my friend.
Me: So, will you come back over here sometime?
Elephant: We’ll see. I’m a sychophant.
Me: Stop it!
Elephant: Sorry. I’m a bit of cryptophant.
Me: Look, I’m busy. I’m going to hang-up.
Elephant: Don’t do that mate. Look, I’ll call you back in a bit, as there’s a guy here who wants my payment.
Me: What are you buying?
Elephant: Cabbage, lettuce, sugar cane, apples, bananas ... and cucumber obvs.
Me: How are you paying?
The elephant hung up, but sent me a pic.
The dollar volume of crypto received by users in Nigeria in May was $2.4bn, up from $684m last December, according to blockchain research firm Chainalysis. And the true scale of crypto flows through Africa’s largest economy is likely to be much larger, with many trades untraceable by analysts.
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Chris M Skinner
Chris Skinner is best known as an independent commentator on the financial markets through his blog, TheFinanser.com, as author of the bestselling book Digital Bank, and Chair of the European networking forum the Financial Services Club. He has been voted one of the most influential people in banking by The Financial Brand (as well as one of the best blogs), a FinTech Titan (Next Bank), one of the Fintech Leaders you need to follow (City AM, Deluxe and Jax Finance), as well as one of the Top 40 most influential people in financial technology by the Wall Street Journal's Financial News. To learn more click here...