How to buy Bitcoin in Nigeria

How to buy Bitcoin in 4 steps

1. Compare crypto exchanges
   The easiest way to buy Bitcoin is from a cryptocurrency exchange. Comparing in the table helps you find a platform with the features you want, like low fees, ease of use or 24-hour customer support.
2. Create an account
   To create an account on an exchange, you will need to verify your email address and identity. Have some photo ID and your phone ready.
3. Make a deposit
   Once verified, you can deposit NGN using the payment method that best suits you – cryptocurrency, bank and card payments are widely accepted.
4. Buy Bitcoin
   You can now exchange your funds for Bitcoin. On beginner-friendly exchanges, this is as simple as entering the NGN or BTC amount you want to purchase and clicking "buy". If you like, you can then withdraw your Bitcoin to a personal wallet.

What is the cheapest way to buy Bitcoin?

First things first – you don't have to buy a whole Bitcoin.

Most exchanges let you buy as little as ₦5 worth of BTC, if not less. Just type in how much you want to spend in NGN and let the exchange work out the rest.

Some platforms only offer 1 way to buy Bitcoin, while others provide several choices. The 2 most common ways to buy BTC are on the spot market or with an "instant buy" feature.

Instant buy

If it's your first time buying Bitcoin, this will be the fastest method – but also the least cost-effective.

The instant buy section is usually located under a "Buy now" heading on the platform you've chosen.

It should feature a simple interface that lets you enter the amount of Bitcoin you want to buy or Nigerian nairas you want to spend.

This is usually the only option available for credit or debit card purchases, but you may also be able to make an instant buy if you've pre-funded your account with a bank transfer.

Be prepared to pay a markup on BTC's market rate in exchange for the convenience.

Spot market

If you see colourful charts with a range of prices, you're probably in the spot market.

The spot market is where buyers and sellers come together to place bids for BTC on the open market. It's usually the cheapest way to buy Bitcoin because it lets traders set their own prices.

You'll find the spot market under a "Trade" or "Spot" heading on the site or app menu of the platform you've chosen to use.

There are several different order types that you can make on the spot market.

• Market order. This will buy you the amount of Bitcoin you specify at the lowest possible price available. This makes it like an instant buy order but with much lower fees.
• Limit order. This is the most common order type and lets you purchase Bitcoin at the price you specify. Traders use this to time the market and capitalise on price dips or increases.

How to find the best place to buy Bitcoin in Nigeria

There are dozens of different trading platforms to choose from when buying Bitcoin in Nigeria, so to help you find your best option, keep these factors in mind:

• Where it's registered. Using a locally registered exchange is a good idea. It's more likely to accept Nigerian nairas and local payment methods , which helps avoid foreign exchange fees. Choosing from Nigeria-based exchanges also means it's likely to be registered with a local regulator (a local regulator), which means it has to comply with local laws in Nigeria.
• Security. Look at the security features the platform has to offer, like 2-factor authentication and PGP-encrypted emails. Cold storage of user funds is considered industry standard, but insurance funds are less common and indicate good security practices.
• Fees. Check the fine print to find out exactly how much your transaction will cost. Depending on the platform you choose, these could include spreads, trading fees and deposit and withdrawal charges.
• Transaction limits. Are there any minimum or maximum limits on the amount of Bitcoin you can purchase? Does the exchange restrict the amount of funds you can withdraw from your account in any 1 transaction or 24-hour period?
• Other platform features. Look out for other features that suit your investment or trading needs. For instance, many exchanges now let you earn yield on your holdings, while some issue crypto debit cards to help you spend your coins.
• Customer support. If you ever have a problem with a transaction, will you be able to quickly and easily get in touch with the customer support team? Are they based in Nigeria? Check what contact methods are available and find out how quick the team is at responding to enquiries.
• Insurance fund. A small number of exchanges now insure user funds. Beware that policies vary greatly between exchanges, so you'll need to research this thoroughly if insurance is important to you.
• Reputation. As a young industry, reputation can provide a lot of clues when choosing an exchange. For instance, who are the founders? Have there been any controversies? Are their business practices transparent? If you can't find any of this information, that may be a red flag.
• Range of coins. If you're thinking about adding other cryptos to your portfolio in the future, check to see what other coins you can buy through the platform.
• Read reviews. Finder's crypto exchange reviews include user feedback, which helps you get a better idea of what the exchange is like to use for other people starting just like you.

Is Bitcoin safe to invest in?

You shouldn't invest in any asset, including BTC, without doing plenty of research first. Before you buy Bitcoin, make sure you understand and weigh up these risks:

• Price volatility. Bitcoin's price is largely based on speculation, which means it can rise or fall in a short time. It's not uncommon for BTC to lose more than 10% of its value in a single day.
• Perceived value. BTC is a unique asset that does not have any tangible value. It derives most of its value from utility and speculation.
• Exchange vulnerabilities. Leaving your Bitcoin on a crypto platform exposes you to several counterparty risks, including:
  • Scams. Scammers frequently try to trick exchange users into handing over their username and password, often by phishing with malicious emails or fake website links. Use 2FA and encrypted emails to help protect your funds.
  • Hacks and theft. Exchanges are vulnerable to hacks and theft, so choose one with good security practices and a track record of safety.
  • Fiscal mismanagement. In mid-2022 a number of crypto platforms froze user funds after it was revealed they had engaged in irresponsible funds management.
  • Insurance. Unlike stocks, only a small handful of exchanges provide insurance on your cash deposits.
• Regulatory uncertainty. The regulatory environment for Bitcoin and other cryptos is constantly changing. It's important to understand how international rulings have the potential to impact Bitcoin's future – for better or worse.
• Novel technology. Bitcoin was created in 2009, which makes it relatively new as a form of technology and as a currency. BTC doesn't yet have the same track record or performance history as some other asset classes.
• Technical learning curve. Evaluating the tech behind BTC before you invest is important, but requires a deep understanding of the blockchain and other aspects of decentralised finance. Be prepared to do plenty of research.
• Wallet vulnerabilities. The Bitcoin network itself is near-impossible to hack, but the software used to manage your funds – known as wallets – is still vulnerable. Thoroughly research a number of BTC wallets before deciding which to use.
• Transactions can't be reversed. Once you've submitted a transaction to the Bitcoin network, it can't be cancelled or reversed. Double-check the receiving address before sending a Bitcoin payment or moving Bitcoin off an exchange. There is no way to refund BTC sent to the wrong address.
• Energy consumption. Bitcoin is reliant on proof-of-work mining, which consumes huge amounts of energy. This could place it in the cross-hairs of governments as the world moves to a greener economy.

Today's Bitcoin price versus ATH

Compare today's price of Bitcoin ($98,899.00 USD) against its all-time high (ATH) price of $99,645.00 USD on November 22, 2024. The closer the bar is to 100%, the closer BTC is to reaching its ATH again.

How is Bitcoin taxed?

Bitcoin is increasingly treated as a financial asset by governments around the world. You may need to declare your BTC holdings at tax time and should consider consulting a tax professional to make sure you don't run afoul of the law.

After you've bought Bitcoin

Bottom line

If you want to buy Bitcoin, start by comparing a range of crypto brokers and exchanges available in Nigeria. Look at their features, fees, security and overall reputation to decide which platform is right for you. Use an exchange registered with a local regulator for added peace of mind.

Remember that owning and using Bitcoin is not without its risks. Carefully consider investing in BTC as part of a wider strategy, and talk to a financial advisor if you have any questions.

Once you've bought some BTC, think about your short and long-term goals. This will help you decide whether to keep it on an exchange or move it to your own wallet.

FAQs