Cryptocurrency

The 21st-century craze: Cryptocurrency and double-speak 

By Sa’adatu Aliyu 

The word ‘craze’ has often veered my mind towards fashion. It’s not uncommon to hear the noise of the latest, let’s say, designer clothing brands or accessories referred to as the “new craze” in town because of how it has people emptying their pockets and savings just to fit in with the vogue purchasing the latest brands.

Well, since cryptocurrency became a household name (to me) at least six years ago, there has been much obsession with it. 

For those who are unfamiliar with it, individuals involved in this believe that it was not merely introduced to benefit a larger segment of the global population, but rather created to empower people to take charge of their assets—in the form of their finances. For instance, the “Democratization of assets” refers to a situation whereby individuals have the authority to control their wealth. These same individuals argue that it decentralises their interactions with banks and similar institutions. 

Given the vocabulary used to explain this, it’s hard to resist. After all, who doesn’t want to grow wealth “fast” and “more”?

As intriguing as this may sound from personal observation and experience, I would argue that this venture has very little to do with what it claims as its intention. At least, its true intentions seem to have been hijacked by unscrupulous individuals who view this as an easy means of facilitating money laundering or engaging in a classic case of robbing Peter to pay Paul. This means rallying the masses to invest in a venture that ultimately benefits the wealthy more than the impoverished, turning a few into the rich while further impoverishing those already in need. This is unmistakably a form of exploitation that the poor will undoubtedly bear the brunt of. Thus, in the spirit of Marxism, I believe this will only exacerbate the imbalance between the rich and the poor in our society, rather than promote financial liberation, at least not for the latter.

This reflects the reality of many instances I have observed. Suppose there is any reward reaped by those who invest time and energy in this. In that case, it is typically only a tiny fraction of people who have succeeded, most likely by promising others definite rewards if they partake in one training or another that offers the secret to unlocking wealth within the crypto venture. For this group, the lies never cease, and for their victims, they cling to the hope that this one more book purchase, class, training, or crypto platform could bring them a step closer to becoming wealthy. 

Consequently, they ensnare people in a cycle of addiction that has driven many to make desperate decisions to “salvage” their so-called wallet or invest further. Among other instances, I have heard of a mother who arranged for the kidnapping of her daughter and used it to solicit donations from the public, which she planned to use to invest in one of these ventures after incurring some losses. 

Another story is of a man who invested all his life’s savings while his family slowly died of hunger. Yet, their breadwinner threw the gospel of their action as driven by a desire to create generational wealth or their long-term investment. This is the habit of a gambler, which inevitably reminds me of the character Isaac Solar in the Telemundo programme Price of Fame, who was a chronic gambler who betrayed his family’s famous Music record label due to his gambling addiction, which eventually led him to the killing of his brother Julio Casear.

So, how is the cryptocurrency scenario any different from gambling–only that it is a digitalised form of gambling that has succeeded in throwing everyone into the loop of addiction? 

Evidently, the actors behind this have tapped into humanity’s psychology regarding the desire for wealth, particularly in our time—it is the new craze of society that we have come to believe can be earned by any means, thereby keeping us on a constant hamster wheel in pursuit of riches. Our attention is drawn to every word, every instance where money is mentioned, casting doubt on its legitimacy. And I could go on. 

So, ultimately, what I set out to say is

People fail to see these mining and crypto-related ventures for what they truly are. To me, they represent another form of gambling, albeit not in the traditional sense we know. Yet, we remain blind to this fact, and even more so, our ears are deafened, as those who have set out to swindle the masses in order to amass wealth for themselves have not only studied the psychology of individuals but have also mastered the art of using language to mislead the world into perceiving this as a reasonable and profitable venture. 

All this does to the poor, however, is rip them of their little savings and, of course, their peace of mind. Many have starved their families just so they could invest in something that yields neither results nor returns; they have gained depression after borrowing and pouring all their life savings into ventures, waiting years for nothing. And let’s not even start with the “it’s a long-term investment” nonsense because that’s rubbish. 

What happens if the investor dies? Can his or her family retrieve the funds? If I need money urgently, can I access my money quickly to address an immediate need? The answer is a definitive no! At least with banks, I can do all of the aforementioned. Therefore, due to the tendency of cryptocurrencies to fluctuate, which keeps you on edge and causes anxiety, I believe banks are more certain alternatives. 

We know for a fact that one of the plagues of the 21st century is the tendency to use language to glamourise the abnormal, turning it into something attractive—the era of double-speak, or what is infamously known as Orwellian language. Where gluttony is called cravings, bleaching is termed toning, being selfish is referred to as self-care, and, of course, in this regard, gambling is portrayed as trading or investment.

Fortunately, few people have gained from these ventures compared to those who spend good time and money but reap nothing over the years. 

It is obvious that after investing, there is no way to retrieve one’s capital in case one no longer finds the venture profitable. It is just dormant, so-called wealth that can’t be retrieved. Let’s not talk about how one’s family cannot retrieve their loved one’s investment after his/her demise. 

It’s sad that many of us have fallen into this trap. Though I’m no Sheikh or Ustaz, whenever I see the craze over cryptocurrency, these are some of the prophets’ sayings that come to my mind.

There is much controversy about the legitimacy of mining or crypto, which is enough reason to avoid it. The prophet SAW has advised us to avoid anything that is ambiguous. 

I come in peace.

 A verse of Allah to reflect upon: 

(2:275) “As for those who devour interest, they behave as the one whom Satan has confounded with his touch. Seized in this state, they say: “Buying and selling is but a kind of interest,” even though Allah has made buying and selling lawful and interest unlawful. Hence, he who receives this admonition from his Lord and then gives up (dealing in interest) may keep his previous gains, and it will be for Allah to judge him. As for those who revert to it, they are the people of the Fire, and in it shall they abide.”

 And the Hadith of the prophet:

Messenger of Allah ﷺ said, “Verily, there is a Fitnah (trial) for every nation, and the trial for my nation (or Ummah) is wealth”. At-Tirmidhi.

Instead of viewing cryptocurrency and its likes as another innovational breakthrough or digital economic revolution, let’s reflect on it from the perspective of the end of times.

Saadatu is a writer and lecturer at the ABU Distance Learning Centre. She can be reached at: Saadatualiyu36@gmail.com

Crypto Airdrops, a distraction in disguise                  

By Thomas Akoji Amodu 

A crypto airdrop is typically performed by blockchain-based startups to help bootstrap a virtual currency project. Its primary aim is to create awareness about the cryptocurrency project and encourage more people to participate when it becomes available. 

Airdrops are generally communicated through the company’s official channels and cryptocurrency communities. Coins or tokens are sent only to specific wallets based on the blockchain network or coins held in existing wallets. Airdrop coins are generated by continuously tapping the phone screen.

Today, the trending event in Nigeria is crypto airdrops, which have attracted millions of Nigerian youths. This became popular following the successful listing of Notcoin in 2023, which paid miners significantly. Since then, Crypto has been introducing several airdrop projects such as MemeFi, X-Empire, Tapswap, Hamster, Tomarket, cats, Dogs and many more to engage miners. Many Nigerian youths spend more than half a day on these mining platforms daily. When it eventually lists on exchanges, they get nothing compared to the time, energy and subscriptions invested in the airdrop.

This engagement with crypto airdrops by Nigerian youths has caused great concern, as many solely rely on it as a full-time job, while some regard it as an escape route from poverty. Youths are becoming lazier than ever before because of these projects. Students tap their phone screens during lecture time, thereby dividing their attention. Even graduates have embraced airdrop mining over creative thinking and productive undertakings. 

This trend has further questioned the state of the country’s economic and political atmosphere because where there is a stable economy, good living conditions and basic provisions for healthy living, the citizens will shun any form of distraction and focus on more beneficial activities. It is pathetic that most Nigerian youths who resort to airdrop mining are graduates who could not secure a job because of bad governance and corruption in the country. 

On September 26th, 2024, one of the most anticipated airdrops, “Hamster,” was listed, and many Nigerian youths were disappointed by the poor payment. Before the listing of Hamster, some people had priced what to buy, such as vehicles, lands, gadgets, and so on. Unfortunately, Hamster paid below expectations, and many became depressed. The time, energy, and sleepless nights spent just to complete tasks were in vain. 

Despite the poor rewards of these crypto airdrops, Nigerian youths do not seem discouraged from engaging in the projects. This clearly indicates the government’s failure to fulfil social, economic, and political responsibilities. The government should establish more industries, provide loans for small business owners, encourage agriculture, and invest in tech education to refocus youths’ attention on a better future.

Thomas Akoji Amodu writes from the Mass Communication Department at Bayero University, Kano, via amoduthomas@gmail.com.

BREAKING: Binance announces departure from Nigerian market, halts naira services

By Sabiu Abdullahi 

Binance, one of the world’s largest cryptocurrency exchanges, has decided to terminate all services related to Nigeria’s fiat currency, the naira.

This decision comes amidst escalating regulatory tensions within the country. 

Effective immediately, Binance will no longer accept deposits in naira, with the cutoff time set for 14:00 UTC today.

Furthermore, withdrawals will be unsupported after March 8 at 6:00 a.m. UTC. 

To streamline the transition process, Binance will automatically convert naira balances to USDT (Tether) at a conversion rate of 1 USDT per 1,515.13 naira, starting on March 8 at 8:00 a.m. UTC. 

In addition, all spot trading pairs involving the naira will be delisted on March 7 at 3:00 a.m. UTC.

Any open spot orders for these pairs will be promptly closed. Moreover, Binance Convert, Binance P2P, the exchange’s Auto Invest feature, and Binance Pay will gradually cease support for the naira at different dates and times. 

This decision marks a significant shift in Binance’s operations within Nigeria, signalling the complexities and challenges of navigating regulatory environments in the cryptocurrency space.

As the industry continues to evolve, stakeholders will closely monitor how this development shapes the landscape for both users and exchanges operating in Nigeria.

CBN instructs banks to disregard initial ban on cryptocurrency

By Abdurrahman Muhammad

The Central Bank of Nigeria’s financial policy and regulation director, Haruna Mustapha, announced in a circular on Friday.

The central bank has issued guidelines and regulations for banks on managing cryptocurrency in accordance with global standards to prevent misuse. They also urge banks to comply with these guidelines and regulations.

See the full statement below: 

FPR/DIR/PUB/CIR/002/003

CIRCULAR TO ALL BANKS AND OTHER FINANCIAL INSTITUTIONS

GUIDELINES ON OPERATIONS OF BANK ACCOUNTS FOR VIRTUAL ASSETS SERVICE PROVIDERS (VASPs)

The CBN in February 2021 issued a circular restricting banks and other financial institutions from operating accounts for cryptocurrency service providers in view of the money laundering and terrorism financing (ML/TF) risks and vulnerabilities inherent in their operations as well as the absence of regulations and consumer protection measures.

However, current trends globally have shown that there is need to regulate the activities of virtual assets service providers (VASPs) which include cryptocurrencies and crypto assets. Following this development, the Financial Action Task Force (FATF) in 2018 also updated its Recommendation 15 to require VASPS to be regulated to prevent misuse of virtual assets for ML/TF/PF.

Furthermore, Section 30 of the Money Laundering (Prevention and Prohibition) Act, 2022 recognizes VASPs as part of the definition of a financial institution. In addition, the Securities and Exchange Commission (SEC) in May 2022 issued Rules on Issuance, Offering and Custody of Digital Assets and VASPS to provide a regulatory framework for their operations in Nigeria.

In view of the foregoing, the CBN hereby issues these Guidelines to provide guidance to financial institutions under its regulatory purview in respect of their banking relationship with VASPs in Nigeria.

The Guidelines supersedes the CBN’s circulars referenced FPR/DIR/GEN/CIR/06/010 of January 12, 2017 and BSD/DIR/PUB/LAB/014/001 of February 5, 2021 on the subject. However, banks and other financial institutions are still prohibited from holding, trading and/or transacting in virtual currencies on their own account.

Accordingly, all banks and other financial institutions are hereby required to immediately comply with the provisions of the Guidelines.

HARUNA B. MUSTAFA

DIRECTOR, FINANCIAL POLICY AND REGULATION DEPARTMENT

Pi mining – the way I see it

By Bilyamin Abdulmumin

314,159 dollars a Pi

One of the grand sagas that have been taking public attention is the issue of the Pi network. This project is said to be launched early in 2019. All potential subscribers need to come on board is a smartphone and data.

It depends on when one starts and how often they mine. But some pioneers (those who register for the crypto) have mined as much as 10000 Pis. However, the contentious saga that has been drawing attention was the Pi (cryptocurrency) relative value.

The value floating across as said to be the Global Consensus Value agreed by the world pioneers was a staggering 314,159 dollars. And already, many pioneers have as many as 10000 Pis. So, at this consensus, an average pioneer with 1000 Pis, the equivalent of 314,159,000 dollars, will need the services of similar camels that transported Alhaji Alhassan Dantata’s coins as the first person in 1929 to open an account with the First Bank. While a regular pioneer with as much as 10000 Pis, the equivalent of 3,141,590,000 dollars, will need the services of the Mansa Musa’s entourage like that accompanied him in 1324 for his first mecca pilgrimage.

The pioneers are determined and looking forward to this gargantuan windfall. Whether jokingly or not, some have already begun to imagine how to spend such jackpots. Many have embarked on the dream of climbing up the top social ladder by building exotic houses, expensive cars, or circumnavigating the globe for those who fancy the adventure.

Like many jackpot winners, these potential overnight billionaires continue to promise family and friends some bounties, including marrying them off, buying them houses in Asokoro, the latest iPhone, or sponsoring their pilgrimages.

While these pioneers continue to sail in their realm, their critics consider their aspirations at best as a mirage and, at worst, question their mental well being

When the President of the Association of Psychiatrists in Nigeria (APN), Taiwo Obindo, says that more than 60 million Nigerians are suffering from mental illnesses, the Pi critics say no wonder.

But one posing point the Pi critics raised is that instead of the pioneers assuming mining, it is actually them who are being mined. In other words, they are the cash cows, referring to the advert pool fee that the Pi initiators are generating from about 40 million users. Very plausible because in this era of social media, subscribers are gold.

On the other hand, the pioneers’ reason, too, is not a pushover. Instead, they point to the traction the Pi is getting, the global state of transition from the fiat currency, and the success of some previous cryptocurrencies such as Bitcoin. According to them, history is repeating itself. When Bitcoin started in 2008, everything was against its subscribers. They were seen as shadow chasers and laughed at. But when success stories began to come in, the doubting Thomas was nowhere to be found.

For those who don’t know how the current Pi value of 314159 came about, Pi is a useful mathematical constant with infinite values ranging from 3.14, 3.14, 3.141, 3.1415, 3.14159… to infinity. But, disregarding the point behind the decimal and in the ascending order, the pioneers arrived at 314159. In addition, to commemorate this mathematical constant, the official Pi lunch was on March 14, which is 3.14, the Pi first value mentioned.

In my opinion (everything considered), the expectations of the pioneers on the Pi network have reached a fever pitch, but the cryptocurrency hitting the market is on the horizon.

Bilyamin Abdulmumin is a PhD candidate in Chemical Engineering at ABU Zaria. He is also an activist for a better, informed society. He can be reached via bilal4riid13@gmail.com.

CBN fines 3 banks ₦800 million over cryptocurrency transactions

By Farid Suleiman

Bloomberg reports that the Central Bank of Nigeria (CBN) has penalized three banks over non-compliance with its cryptocurrency directive. The affected banks are Stanbic IBTC Bank, Access Bank Plc and United Bank for Africa.

In a circular dated January 5, 2021, the apex bank had issued a directive to Deposit Money Banks (DMBs), Non-Bank Financial Institutions (NBFIs), and other financial institutions (OFIs) to identify and suspend all accounts of individuals and entities used for cryptocurrency transaction on their system.

“Further to earlier regulatory directives on the subject, the bank hereby wishes to remind regulated institutions that dealing in cryptocurrencies or facilitating payments for cryptocurrency exchanges is prohibited,” the circular reads.

“Accordingly, all DMBs, NBFIs and OFIs are directed to identify persons and/or entities transacting in or operating cryptocurrency exchanges within their systems and ensure that such accounts are closed immediately.”

The affected banks were fined a combined sum of ₦800million. Stanbic IBTC Bank, United Bank of Africa and Access Bank were fined 200million, 100million, and N500million, respectively.

El Salvador becomes first country to legalise, incentivise use of Bitcoin

By Muhsin Ibrahim

El Salvador has become the first country to make bitcoin a legal tender in the world. According to the Central American country president, Nayib Bukele, the government will give every adult citizen $30 in bitcoin, provided they download and register the government’s cryptocurrency app, known as Chivo.

The 39-year-old Bukele, who is also a right-wing populist, rose to power in 2019. Since then, he has initiated drastic changes in the small country. He announced plans to start using bitcoin in June. Late Monday (yesterday), he made another announcement via a televised speech, which was also streamed on YouTube, that the digital currency becomes legal from today (Tuesday).

El Salvador’s official currency is the U.S. dollar.

In his reaction to the fears expressed by some people and financial experts, particularly regarding the future of wages and pensions in bitcoin, President Bukele explained that Salvadorans will still have access to dollars.

Matt Novak, a Gizmodo reporter, questions whether or not El Salvador’s experiment with bitcoin will work. In response to that, he adds that “Only time will tell. But with bitcoin’s wild volatility it’s hard to see how the economy won’t get absolutely crushed when bitcoin’s price plunges.”

PSG: Lionel Messi gets partly paid in cryptocurrency

By Muhsin Ibrahim

The Argentinian star’s bonus contains $PSG Fan Tokens, a cryptocurrency created by and dedicated to the club. The French League 1 club, Paris Saint-Germain (PSG), signed Lionel Messi after a long, successful career at FC Barcelona.

PSG did not clarify what percentage of the deal included the chips. However, reports indicate that they received a “large number” of them. Socios.com issues the token.

According to Le Figaro, a famous French daily newspaper, fan tokens are a cryptocurrency that allows holders to vote on mostly minor decisions related to their clubs.