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Experts Highlights the Dangers of Unregulated P2P Trading in Nigeria
Dangers of Unregulated P2P Trading: On February 28, the Nigerian crypto community was shocked by the news that Binance, the world’s largest cryptocurrency exchange, was removing the Naira Peer to Peer option from its platform.
This decision followed a row between Binance Limited and Nigerian authorities, with the later accusing Binance of currency manipulation and tax evasion.
Dangers of Unregulated P2P Trading
The development meant that the Nigerian crypto community has little to no trusted centralized exchange to rely on for safe and smooth P2p trade.
The P2P market in Nigeria is quite huge as many Nigerians who earn in dollars are in constant need to convert their USDT to Naira via trusted means.
The process can only be secure if there is a centralized exchange that acts as a mediator or guarantor between the seller and the buyer to reduce the risk of fraud and the threat of bad actors.
The closure of Paxful and the elimination of P2P trading on Binance threw the Nigerian crypto community into the Wild West of unregulated transactions and uncontrolled actors.
Also Read: Crypto Firm Convicted of over unlicensed USDT-Naira trading, Transfers N140 million to FG
Nigerians Rely On Alternative Platforms For Trading
Nigerian crypto enthusiasts now rely on direct P2P trade with WhatsApp and Telegram in the absence of any escrow or middleman.
Direct P2P trade is very risky and the menace of bad actors has tripled since the exit of Binance and Paxful from the Nigerian market.
Rume Ophi, a leading crypto analyst in the African space spoke to Nairametrics on the Cons of Direct P2P trade pointing out how the space badly needs regulation.
“Illicit transactions can be difficult to monitor and regulate with direct P2P.”
Rume also pointed out the obvious risk of losing your crypto assets to scammers posing as merchants.
“Bad actors claiming to be trusted can go with your coins and you may not be able to get them in the short term, Blockchain investigation costs much someone duped might not be able to afford it.”, Rume added.
In the absence of the Binance crypto exchange, some viable alternatives still exist for crypto enthusiasts who don’t want to risk Direct P2P.
Exchanges like Local Traders offer safe P2P services for zero fees with up to 750 payment options including major Nigerian Banks.
Such options are viable for Nigerian P2P traders who want to continue P2P Trading but don’t want to risk Direct P2P on telegram or WhatsApp.
P2P trading is the backbone of the Nigerian crypto market and will always thrive regardless of existing policies and bottlenecks.
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