Bitcoin trading in Nigeria is one of the passive ways to make money in the country and I’m sure you’re aware of that, but what you don’t know is how it really works. That’s what we are to discuss right now.
Based on the recent happenings in Nigeria and the world at large, I decided to cover one of the trending topics today – Bitcoin. This post will introduce you to the ever-growing world of Bitcoin, cryptocurrency, and Blockchain technology.
This post isn’t just for newbies, but also for those with existing knowledge of how Bitcoin trading and cryptocurrencies work in Nigeria.
Join me as we venture into this new world of digital money. But first, let’s start with how it all began.
Evolution of Money
Any agreed commodity we choose to give value that can be used for the purchase of goods and services is termed as money. It began with brick and stones, then barter where we exchanged goods for other goods – based on the assigned value.
We then moved to gold where we assigned some sort of value to them. And then came metallic coins.
Notice a trend? The physical size of what we call ‘Money’ overtime has continued to reduce. This solves the problem of portability which is one of its features. Metallic coins were physically smaller, but when accumulated, it’s nearly impossible to carry around. This gave birth to paper currency as we know it today.
Paper currency did solve the issue of portability, at least to a reasonable extent. But it did come with its problems too. More significantly is the issue of inflation. Also, it is owned and controlled by a government that regulates and controls its distribution.
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Now they could print as many currencies as they want, then push it out into the economy. This in itself among other factors leads to inflation which devalues such currency over time.
So how do we solve this problem? Thanks to technology which has been about improving every aspect of our lives, we now have digital currencies. Digital currencies are set to change the way money works, and it’s just getting started.
Meaning of Cryptocurrencies?
Cryptocurrency, otherwise known as digital currencies are here to stay. And Bitcoin is one of its forerunners. Unlike conventional money, cryptos are decentralized i.e. they are not controlled by a central body e.g. CBN. This is one of its major advantages.
Digital currencies are protected by cryptography which makes it nearly impossible to be destroyed or duplicated. This can’t be said about paper money which is prone to damages if not properly handled.
And due to the decentralized nature of cryptocurrencies, they can be sent and received by anyone anywhere in the world without restrictions. Naira as we all know can’t be sent to someone in the United States. Yes, there exist some ways of doing this, but it’s made easier by crypto.
Digital currencies have indeed solved some of the problems that came along with conventional currencies. But how are all these possible? What’s the technology behind digital currencies? Well, read along.
Meaning of Blockchain
The leaps we made in the world of digital money has been made possible by Blockchain technology. It makes use of cryptographic hashes to record each and every transaction in a database. Unlike other databases, the Blockchain stores transactions in the form of blocks.
Aside from this, the technology has helped greatly in the field of remittance across countries. Sending money via your favorite digital assets is made possible by Blockchain technology. Though remittance can be carried out using fiat currencies (paper money), this seemingly new technology has reduced the time, cost, and intermediaries needed to facilitate such transactions.
Different digital currencies are built on a different Blockchain network. Bitcoin was the first digital asset built on the Blockchain network by Satoshi Nakamoto in 2008. And today, it is the leading digital currency. This is why I’ll be introducing you to how to make money trading Bitcoin. So stay with me.
What is Bitcoin?
Bitcoin, you heard about it on the news, friends have spoken to you about it, you’ve even seen it on the internet. But what exactly is Bitcoin? I’ll tell you.
Bitcoin is the first cryptocurrency to have ever existed. Though other forms of digital money have been attempted, Bitcoin is seen and recognized as the first. It was founded by a Japanese who goes by the pseudonym Satoshi Nagamoto. It was all made possible through Blockchain technology.
Bitcoin was created to solve the problems faced by fiat currencies. One of such problems has to do with control. And this was solved in two ways: first, it is decentralized which makes it free of control by anybody, the CEO, or a group of persons. Secondly, and also to curb inflation, Bitcoin has a limited supply of 21 million. In essence, we can’t have more than 21 million Bitcoin in existence.
This leads to an increase in demand which will invariably increase its value over time. And so it has been from it’s all-time low of $0.003 to an ATH of $42,000 and currently at 40,000 USD. If you had bought it in 2008, you would have been super-rich by now. But it’s not too late to jump on the moving train, there are more ways to make money off Bitcoin. One of such ways is Bitcoin Trading!
How to Trade Bitcoin in Nigeria?
It’s simple, as conventional trading would suggest, you buy low, then sell at a higher price. That’s what we’ve grown up to know, but is that ideal in the world of digital currencies? To an extent, yes, but there are some variations.
Ask yourself this, when do I know when to buy and when to sell. How do I know if the price is low enough? And if the price appreciates, how high is high enough to make profits? Though it’s an exciting world, the crypto space comes with many complexities which you’ll have to master.
Here are certain things to factor in before getting into trading because I can tell you first hand, it’s not for the faint-hearted, it’s not for the emotional, you need lots of patience as this isn’t a get rich quick scheme. You need to know the basics, then walk your way up from there.
Bitcoin Trading is a skill to be learned, you can as well call it a profession. Just like the medical doctors who spend years to attain mastery in their craft, so is a trader expected to spend months, or probably years mastering the ins and out of the crypto space. As you learn the ropes, bear in mind that techniques will help you, but instincts will save your life.
There are different trading patterns, but learning the following will take you a long way:
- Candlesticks
- Risk management
- Support and Resistance
- Trendlines
- Triangle patterns
- Technical indicators
- Entry and Exit strategy
- Market structure
Armed with the knowledge of these, you should be well on your way to making money off Bitcoin and other cryptocurrencies. There are tons of free and paid courses that could help you level up. No course is perfect, no course is the best, just pick whatever works for you. Personally, I understand some tutors more than others. Because a course has the best reviews and ranks higher than the rest doesn’t mean it’s the best for you. It’s best you take out time to choose because sometimes, what’s good for the goose isn’t good for the gander.
Pro and Cons of Bitcoin Trading
So if you choose to begin trading after reading this post, make sure to bear the following pros and cons in mind:
Pros of Bitcoin Trading
- Global payments made easy: Unlike fiat, you can pay for goods, services, or pay merchants anywhere around the world with just a few clicks.
- Transparent: Bitcoin is open source. And thanks to Blockchain technology, you can view each and every transaction carried out using a Blockchain explorer. Anyone and everyone can see it too.
- Secure means of payments: Cryptography makes it difficult for third parties to tamper with your money. You can send and receive money anonymously.
- Low fees: This is relative. It also depends on what wallet or exchange you use.
Cons of Bitcoin Trading
- Volatility: The major problem that has hindered Bitcoin and other cryptocurrencies from getting wide acceptance is their unstable nature. Fiat currencies do a better job in this regard.
Recommended Platforms, Apps, and Tools for Bitcoin Trading in Nigeria
So, if you’ll be going into trading of Bitcoin make sure to have the following:
- A good laptop or smartphone (or both)
- An exchange: Binance, Luno, Buycoins, Okex etc.
- A wallet for storing your coin and tokens: Hot wallets like Trustwallet, Metamask, Atomic Wallet, Math Wallet. Or you could go for cold wallets (offline) like Trezor and Ledger.
- A 2FA app: Authy, Google Authenticator
- Extras: Coinmarketcap (app or web), Coingecko (app or web), TradingView (app or web)
PS: You need to be on different social media platforms to stay updated on the latest happenings.
Are you ready to get into Bitcoin Trading?
Are you? You better be because the world is moving at an incredible rate and it waits for no one. Bitcoin trading still remains one of the better ways of making passive income in Nigeria. If you’re yet to start, please do.
In my next blog post on this category, I’m going to discuss a few ways you can make money with Bitcoin and other cryptocurrencies.
And if you’re already a trader, do well to share your experiences with us in the comments.
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