How to Invest in Crypto in Nigeria
How to Invest in Crypto in Nigeria revealed. We tested the best way to invest in crypto for Nigerian Traders.
This is a complete guide to invest in crypto in Nigeria.
In this in-depth guide you’ll learn:
- What is Crypto?
- How to buy Crypto in Nigeria?
- Which crypto should you invest in?
- With which wallet should you buy crypto?
- Which brokers offer a sign-up bonus for first-time traders in Nigeria?
- Which brokers offer a low minimum deposit of $5 (2 185 NGN) to start trading?
And lots more…
So if you’re ready to go “all in” with the best-tested way to invest in Crypto in Nigeria…
Let’s dive right in…
What is the difference between trading and investing?
👉 When considering generating money on the stock market, it is essential to understand the fundamentals. There is a common misunderstanding between the phrases investing and trading, which must be clarified.
👉 The purpose of investing is to amass wealth over time via the use of long-term strategies such as mutual funds, purchasing and selling a portfolio of stocks, bonds, a basket of equities, and other similar investments.
👉 Trading is a short-term, dynamic activity characterized by numerous transactions depending on market movements. Compared to long-term transactions such as mutual funds or bonds, it is brief.
👉 Examples of common forms of trading include equities, commodities, foreign exchange [Forex], and other financial instruments.
How to Invest in Crypto in Nigeria
Considerations for Nigerians who want to invest in Cryptocurrency
👉 First, if you want to invest in cryptocurrency, you must have your money in order. This requires an emergency fund, a reasonable amount of debt, and, ideally, a diverse investment portfolio.
👉 Your crypto assets can be added to your portfolio, ideally helping to increase your overall returns. Nigerians must pay attention to a few additional factors before they begin investing in cryptocurrency.
Never invest more than you can afford to lose
👉 It is crucial to avoid investing necessary funds in speculative assets. If you cannot afford to lose it all, you cannot afford to invest in risky assets like cryptocurrencies or market-based assets like stocks or ETFs.
👉 Whether it is for a down payment on a home or an anticipated major purchase, money that you may need within the next several years should be maintained in secure accounts, and if you want a guaranteed return, your best choice is to pay off your debt.
👉 Never disregard the security of any exchange or broker that you use. Even if you legally possess the assets, someone must still protect them, and that protection must be stringent.
👉 If they do not believe their cryptocurrency is protected, some Nigerian traders prefer to purchase a crypto wallet to store their coins offline, making them unavailable to hackers and other parties.
Make sure that you manage your risk
👉 Short-term trading of any asset requires risk management, and this may be particularly true for volatile assets such as cryptocurrencies.
👉 Subsequently, as a novice investor, you will need to grasp how to effectively manage risk and build a method for mitigating losses. And this procedure may differ from person to person:
➡️ A long-term investor’s risk management can consist of never selling, regardless of price. The long-term perspective enables the investor to maintain the position.
➡️ Risk management for a trader with a short-term horizon may include establishing rigorous standards for when to sell, such as when an investment has declined by 10%. The trader then follows the rule mechanically so that a little fall does not become a devastating loss in the future.
👉 At least initially, novice traders might consider putting aside a specific amount of trading capital and spending just a fraction of it. If a position swings against them, they will still have funds available for future transactions.
👉 The final argument is that if you do not have money, you cannot trade. Keeping some funds in reserve ensures that you will always have sufficient funds to fuel your trade.
Remember that volatility is an inherent risk with crypto investment
👉 The values of cryptocurrencies are as volatile as an asset can be. They might fall precipitously in a few seconds if a report that turns out to be false spreads.
👉 This could be advantageous for knowledgeable investors who can execute transactions quickly or who have a firm understanding of the market’s fundamentals, its current trend, and its potential direction.
👉 It is a minefield for novice investors who lack these abilities or the high-powered algorithms that guide these deals. Volatility is a game played by affluent traders, each of whom attempts to outgun other wealthy investors, and volatility could easily overwhelm a beginner investor.
👉 This is because volatility scares away traders, particularly novices. Meanwhile, other traders may purchase at a discount. In summary, volatility could aid professional traders in “buying low and selling high,” whereas naïve investors will “buy high and sell low.”
Realize that the past cannot indicate future outcomes
👉 Numerous novice investors commit the error of projecting the past into the future. Bitcoin was formerly worth pennies, but its value has since increased significantly.
👉 The crucial issue revolves around whether the growth will continue, albeit at a slower rate. Investors focus on the future, not the previous performance of an asset.
👉 Nigerians must consider the factors that could influence future returns. Therefore, Nigerian investors who purchase a cryptocurrency today must seek tomorrow’s returns, not yesterday’s performance.
Make sure that you understand your investment
👉 As you would with any other investment, you should know precisely what you are investing in. When purchasing stocks, it is essential to properly study the prospectus and research the company.
👉 Plan to do the same with all cryptocurrencies, since there are hundreds of them, they all operate differently, and new ones are formed daily. You must comprehend the investing rationale for each transaction.
👉 In the case of several cryptocurrencies, they are supported by neither tangible assets nor cash flow. Many crypto assets depend on the market growing more enthusiastic and bullish for you to benefit, as opposed to stocks, where a firm could expand its earnings and provide returns for you.
Explore the diverse Ways that You can Invest in Cryptocurrencies
👉 While investing directly in cryptocurrencies may be the most common method, there are other methods for traders to enter the crypto market, some of which are more direct than others.
👉 Each of these techniques differs in terms of exposure to cryptocurrencies and risk, so you will need to understand what you are purchasing and whether it meets your requirements. Alternative crypto investment venues include:
➡️ Crypto Futures
➡️ Crypto Funds
➡️ Crypto Exchanges or broker stocks
➡️ Blockchain Exchange-Traded Funds (ETFs)
👉 Futures are another opportunity to speculate on crypto price fluctuations, and futures enable you to employ leverage to earn large gains (or losses). Futures are a fast-moving market that exacerbates crypto’s already unpredictable fluctuations.
👉 A few crypto funds (such as the Grayscale Bitcoin Trust) enable you to speculate on the price fluctuations of Bitcoin, Ethereum, and a few other cryptocurrencies. Subsequently, they might be a simple method to acquire cryptocurrency through a fund-like product.
Crypto Exchanges or broker stocks
👉 Buying the shares of a crypto exchange or broker that is positioned to benefit from the development of bitcoin regardless of the winner might also be a viable strategy.
👉 In addition, there is the possibility for an exchange like Coinbase or a broker like Robinhood, both of which get a substantial portion of their income from cryptocurrency trading.
Blockchain Exchange-Traded Funds (ETFs)
👉 A blockchain ETF enables you to invest in firms that may benefit from the development of blockchain technology. The leading blockchain ETFs provide exposure to some of the industry’s most prominent publicly listed businesses.
👉 However, it is vital to remember that these firms often engage in activities unrelated to bitcoin, which dilutes your exposure to cryptocurrencies and reduces your potential gain and loss.
How to choose a digital asset for your investment portfolio
👉 Before buying coins or tokens just because someone thinks they are a sound investment, Nigerian investors will find that they must do thorough research into the coins they wish to purchase.
👉 Initially, it is essential to recognize that selecting a good cryptocurrency differs from selecting a good stock. A stock signifies ownership in a corporation that has the potential to generate money for its shareholders. Possession of a cryptocurrency signifies ownership of a digital asset with no inherent worth.
👉 The price of a cryptocurrency increases or decreases according to supply and demand. If there is an increase in demand and a decrease in supply, the price will rise. If the supply is constricted, the price will rise, and vice versa.
👉 Consequently, while analysing a cryptocurrency, the most significant issues to address are:
➡️ How does the supply grow?
➡️ What will raise the coin’s demand?
👉 These questions can be answered by:
➡️ Reading the white paper that a cryptocurrency team releases to generate interest in their product. Check the project’s road plan for anything that might stimulate a rise in demand.
➡️ Determine if the team behind a project has the capabilities to accomplish its vision via research.
➡️ Find a network of individuals who have previously invested in cryptocurrency and measure the investor sentiment.
👉 Consider the amount of money that has previously been invested in a cryptocurrency. If the market capitalization is already big, there might not be much room for expansion. In addition, a high price will reduce demand and raise supply as early investors seek to withdraw their funds.
How to start investing in Cryptocurrencies
👉 Once you have identified a cryptocurrency that you believe would be a solid investment, it is time to begin purchasing. There are several exchanges to choose from, with Coinbase, KuCoin, Gemini, Huobi Global, Binance, and Kraken being the most popular.
👉 Many exchanges permit debit card purchases of cryptocurrencies such as Bitcoin and Ethereum, while others allow you to purchase using crypto.
👉 You could purchase fractions of a coin with many common currencies, including Bitcoin, so you do not need to spend hundreds of dollars to enter the game.
👉 Probability dictates that you will require Tether, Bitcoin or Ethereum to acquire altcoins. You cannot purchase altcoins using fiat currency (this is how crypto fans refer to paper money such as dollars and euros).
👉 Exchanges generate revenue via transaction fees, but there are other platforms where you may engage directly with other individuals wishing to trade Bitcoin, and LocalBitcoins is a popular illustration of this.
👉 The procedure will certainly be more time-consuming than an exchange, and there is the extra danger of dealing directly with an unknown individual whose money cannot be verified. You will want to utilize an exchange if you are still new to cryptocurrency.
👉 An alternative way to invest in cryptocurrencies is using a Bitcoin ATM, and there are presently two Bitcoin ATMs in Nigeria, which is a method that is growing more widespread, and they could be used to acquire Bitcoin and transfer it to a wallet.
👉 Purchasing cryptocurrency is simple. As a cryptocurrency investor, you must anticipate volatility. In general, cryptocurrencies are more volatile than conventional asset types like equities. Price fluctuations of 10% or more within a few hours are quite usual.
👉 In addition, you should assess how much of your portfolio you eventually want to devote to a particular cryptocurrency and the asset class overall.
👉 Because of the inherent volatility associated with cryptocurrencies, make sure to provide yourself with broad acceptable allocation ranges, and if your assets fall outside of these ranges, you should rebalance them.
How to store your Cryptocurrencies
👉 Sending anything to your wallet does not always entail putting your Bitcoin in a physical wallet. A cryptocurrency wallet is required to safely store the code that makes up your portfolio of cryptocurrencies as well as to keep your money.
👉 A hardware wallet or a software wallet are also options. Software wallets are essential for active trading since they simplify access to funds. For instance, you can get a native Coinbase software wallet once you register for a Coinbase account.
👉 Hardware wallets are more secure than software ones since they are real, tangible devices that resemble USB drives. They could be used for funds that you do not anticipate using often or have access to with ease.
👉 To make it simple to understand this, Nigerians can compare a hardware wallet to a savings account, and a software wallet to a transaction bank account.
Pros and Cons of Investing in Crypto
|✔️ Pros||❌ Cons|
|Diversification: The value of cryptocurrency seems uncorrelated to the prices of equities, bonds, and other asset classes. However, cryptocurrency has only been for around a decade, therefore the available data is limited. Theoretically, it makes sense that the price of cryptocurrencies is independent of the price of conventional assets.||There is minimal regulation in the cryptocurrency business, so you do not have the same safeguards as when investing in the tightly regulated stock market. If your account is hacked, for instance, you might lose your whole investment without recourse. If the currency you invest in turns out to be a fraud, you have no recourse. In addition, tighter regulation may reduce the demand for certain cryptocurrencies, hence increasing the investment risk.|
|As cryptocurrency’s usage rises, its return potential has delivered astronomically high returns. Most individuals agree that the projected return on a solid cryptocurrency investment is higher than that of equities.||The values of cryptocurrencies may fluctuate dramatically daily. Such extreme price fluctuations might be difficult for some investors to endure.|
|Unlike equities, certain cryptocurrencies offer additional usefulness. For example, Bitcoin (BTC) could be employed to pay for products and services. Other tokens could provide access to certain projects or discounts on the services offered by a project.|
Tips for Responsible Crypto Investment
➡️ Investing in cryptocurrencies might be an attractive option for a piece of your portfolio, but you should diversify your holdings with other assets. A financial adviser could guide asset allocation and aid in the development of an investment strategy.
➡️ Your investment amount is contingent on your risk tolerance and time horizon.
➡️ You should not invest in cryptocurrencies without a strategy. Proper trade planning is essential to your success as an investor, and your crypto trading strategy is your compass while you invest. It permits you to maintain a level of emotional detachment.
➡️ Diversification is a well-known approach for mitigating market risk by spreading capital among various crypto assets that react differently to varying crypto market situations.
➡️ Many novice crypto traders desire to get wealthy quickly. Many have lofty expectations, intending to become wealthy in a few months. It is possible to lose money on the market and having a long-term strategy can help you remain optimistic. Long-term transactions have shown to be a profitable investment strategy (elite investors such as Warren Buffet favour this approach), but they need extensive study and analysis.
➡️ When cryptocurrency values drop, it is common to hear the expression “Buy the dip!” If you are in it for the long haul and understand the dangers, there is nothing wrong with purchasing a dip. However, you may come to despise yourself if you engage in a short-term trade in a declining market without doing sufficient technical research.
➡️ The significance of research cannot be stressed enough. Proper research provides you with clear guidance for applying your trading strategies, allowing you to be confident and decisive with your investing decisions.
➡️ “Fear of Missing Out” (FOMO) is one of the most prevalent reasons why investors blow their funds. FOMO is a typical emotion among investors since no one wants to miss out on a lucrative opportunity. To capitalize on the market, they lose concentration and deviate from their trading strategies. The greatest strategy to combat FOMO is to adhere to your trade plans and research regardless of the circumstances.
➡️ Leverage is borrowed money that permits you to trade more than your initial investment. Leverage of 100:1 allows you to trade with 100 times your initial investment. As advantageous as leverage can be, it raises the likelihood of liquidation, i.e., losing all your money plus the amount you leveraged. Remember that leverage can result in both gains and losses.
➡️ The greatest investors are not always those with the best tactics, but those who have mastered the complexities of the cryptocurrency market.
How to choose the Right Crypto CFD Broker in Nigeria
👉 The need for Bitcoin brokers has grown because of the thousands of individuals interested in investing in cryptocurrencies globally.
👉 Numerous Bitcoin brokers will be offering their services on the market, but you will also run across reports of frauds involving Bitcoin brokers.
👉 Not all Bitcoin brokers can be trusted since many of them have turned into frauds. Even if they are, they lack adequate security measures or are deficient in certain key areas, which may cause a lot of issues for Bitcoin traders.
👉 You must thus carefully choose a crypto broker, and we have provided key features that you must verify before you deal with a crypto broker.
Background and Financial Backing
👉 A good Bitcoin broker has robust financial support, which necessitates a substantial capital basis. This ensures that your Bitcoin is secure and that the broker will not go bankrupt.
Experience and Credibility
👉 The crypto market is young compared to other markets. However, this does not imply that all brokers are unskilled. There are reputable and professional Bitcoin brokers available for usage.
👉 Bitcoin brokers must possess the necessary qualifications, such as licenses from famous and respectable regulatory authorities and specialists on their staff. You can read reviews of the broker and get insight into their services to assess whether they are a good match for you.
Responsive Customer Support
👉 Since Bitcoin trading is available 24 hours a day, seven days a week, you could have a problem or query at any moment.
👉 Therefore, it is important to seek a broker who is accessible 24/7. Regardless of your time zone, they should have a competent support crew that can respond to inquiries and concerns in a timely and professional way.
Crypto Trading Fees and Commissions
👉 You must investigate the commissions and other costs that Bitcoin brokers impose. Ensure the broker outlines the fees they charge, and any other dangers associated so that you may make an informed choice.
👉 No Bitcoin broker is complete without a user-friendly web, desktop, or mobile platform, often all three. These platforms are required for an assortment of reasons.
👉 They give customers a great degree of simplicity in Bitcoin trading, and a well-designed platform provides them with a variety of possibilities.
👉 These choices make things easier and more comfortable for novice and seasoned Bitcoin traders alike. Ensure that your preferred dealer has a modern platform or a selection of platforms.
Longevity of brokerage
👉 There may be a small number of trustworthy Bitcoin brokers that have just started up, but they are quite rare. If a Bitcoin broker has been in existence for an extended length of time, it has been doing something right, as shown by the fact that customers continue to depend on it.
Account Registration Process
👉 Very few traders realize that the registration procedures of Bitcoin brokers reveal a great deal about their character. Veteran traders in this industry can rapidly determine if a broker is excellent or terrible based just on the sign-up procedure.
👉 You may initially have some problems with spotting the legit Bitcoin brokers. However, as time goes by, you will have a better time distinguishing between excellent and unfavourable brokers. A vast number of depositing fees is a frequent indicator of a fraudulent sign-up procedure.
👉 Most instances in which Bitcoin brokers urge their customers to deposit a big sum of money to join up are probable scams. This is made apparent by the fact that many reputable Bitcoin brokers now accept little or no deposits from prospective clients.
👉 You should opt for these Bitcoin brokers instead of those that want vast quantities of money for crypto transactions.
👉 Additionally, investigate the process’s security. You can do this by examining the search bar’s top-left corner for an SSL certificate. This certificate ensures that a website is secure and will not expose your data to hackers.
Technical Support for Cryptocurrencies
👉 The distinction between customer service and technical assistance cannot be overstated. Most firms have technical support teams to assist clients with issues that need assistance from experts in that field.
👉 A significant majority of Bitcoin brokers lack any form of technical support personnel. They believe that their customer service professionals are sufficient for the task and depend only on them.
👉 The team should comprise Bitcoin industry veterans with decades of expertise. They should have a thorough understanding of how things operate and be able to deliver rapid answers within minutes.
👉 Determining whether a Bitcoin broker has a competent technical support staff might consume considerable time. In most instances, a substantial bit of trial and error is required.
👉 If a Bitcoin broker does not provide any convenience, they are not worth your time. As the environment changes, this sector is undergoing tremendous change. To make the appropriate judgments at the right time, you must be current on many matters.
👉 This is only achievable if your broker provides you with features that enhance your entire experience. Your broker’s platform should be compatible with a range of devices.
👉 Using your smartphone or tablet, you should be able to access your account and see all your trades and other crypto-related actions.
👉 Easy accessibility enables you to trade on the move while guaranteeing that you do not miss anything crucial and aside from that, the broker should utilize straightforward language.
👉 Today, one just cannot do without a reliable demo trading solution. There are several complex circumstances involved in Bitcoin trading. If you are just beginning in this sector, you will not know how to make timely judgments.
👉 You will lose a substantial amount of money as a result, and Bitcoin demo trading might help you avoid these errors.
👉 It will instruct you on trading in the actual world while guaranteeing that your selections do not negatively affect your funds. With this option, you will neither gain nor lose money. Nonetheless, you will get knowledge about how cryptocurrency trading is conducted.
The Best Crypto Brokers in Nigeria
👉 In this article, we have listed the best brokers that offer trading solutions and opportunities to traders in Nigeria. We have further identified the brokers that offer additional services and solutions to Nigerian traders.
Best MetaTrader 4 / MT4 Broker in Nigeria
👉 Overall, Axi is the best MT4 Broker in Nigeria. More than 130 different items from Axi are available for trading on MetaTrader 4. Axi offers some of the greatest trading conditions to Nigerian traders, including minimal opening spreads on all account types.
Best MetaTrader 5 / MT5 Broker in Nigeria
👉 Overall, RoboForex is the best MetaTrader 5 broker in Nigeria. RoboForex provides traders with a selection of 12,000 tradable instruments that may be traded on MetaTrader 5 in addition to a few more potent trading platforms.
Best Broker for beginners in Nigeria
USD 100 / 41450 NGN
MetaTrader 4, MetaTrader 5, Ava Social, Ava Protect, Trading Central
Account Activation Time
👉 Overall, AvaTrade is the best Broker for beginners in Nigeria. For new traders in Nigeria, AvaTrade provides some of the greatest teaching resources. Along with webinars, seminars, and other events, there are severall manuals and videos.
Best Low Minimum Deposit Broker in Nigeria
👉 Overall, HF Markets is the best Low Minimum Deposit Broker in Nigeria. With a minimum investment of 2,000 Naira, HF Markets provides live trading accounts to Nigerian traders.
👉 Popular MetaTrader cryptocurrency broker HF Markets also has an in-house trading app for iOS and Android users.
Best ECN Broker in Nigeria
Account Activation Time
👉 Overall, Pepperstone is the best ECN Broker in Nigeria. One of the biggest forex and CFD brokers in the world, Pepperstone provides services in more than 170 nations.
👉 Nigerian traders should anticipate among of the quickest transaction execution times with little to no slippage and no requotes.
Best Islamic / Swap-Free Broker in Nigeria
USD 0 / 0 NGN
ASIC, BVI, CFTC, FCA, FFAJ, FSC, IIROC, MAS, NFA
Metatrader 4 and Metatrader 5
Account Activation Time
👉 Overall, OANDA is the best Islamic / Swap-Free Broker in Nigeria. Three different retail accounts are available from OANDA. This includes a specific Islamic account that is provided to Muslim traders in Nigeria who adhere to Sharia law.
Best Trading App in Nigeria
USD 1 (415 NGN)
IFSC, FSCA (south africa), ASIC, CySEC
MetaTrader 4, MetaTrader 5, FBS Trader – all in one mobile trading platform.
$140 (58 116 NGNFind out More)
Account Activation Time
👉 Overall, FBS is the best trading app in Nigeria. FBS provides its cryptocurrency account through the FBS Trader. Many features and some of the greatest market analyses are available to Nigerians.
Best Nigerian Naira Trading Account Broker in Nigeria
👉 Overall, Exness is the best Nigerian Naira trading account Broker in Nigeria. One of the top multi-currency brokers that provide accounts in NGN is Exness. Exness is a broker that only works with MetaTrader and has a limited selection of trading options.
Best Lowest Spread Broker in Nigeria
👉 Overall, IC Markets is the best lowest spread Broker in Nigeria. IC Markets provides some of the narrowest spreads in the market because of its pure ECN execution mechanism.
👉 Nigerian traders can choose from a variety of crypto CFDs at IC Markets, which offers services to traders all over the world.
Best NDD Broker in Nigeria
👉 Overall, XM is the best NDD Broker in Nigeria. XM is a well-known No-Dealing Desk broker that offers services to over 2.5 million traders worldwide. A portion of XM’s broad selection of more than 1,000 financial products includes cryptocurrency CFDs.
Best STP Broker in Nigeria
USD 100 / 41450 NGN
CySEC, FCA, FSA, FSCA, Labuan FSA
Meta Trader 4
Account Activation Time
👉 Overall, Tickmill is the best STP Broker in Nigeria. One of the finest brokers for new traders in Nigeria is Tickmill, which provides outstanding STP and ECN execution along with clear trading costs.
Best Sign-up Bonus Broker in Nigeria
USD 1 / 415 NGN
Account Activation Time
👉 Overall, SuperForex is the best sign-up bonus Broker in Nigeria. One of the brokers with the broadest selection of promos and incentives is SuperForex, which provides customers with a choice of 11 trading accounts.
👉 Many astute investors have wisely chosen to avoid the volatile cryptocurrency sector. If you are a beginner and want to go into crypto investing, though, it is important to remember that you should never invest more money than you can afford to lose.
👉 Although it is simple to get started with crypto, you must first do your homework before committing to any one cryptocurrency. In addition, always remember that cryptocurrency prices might fluctuate wildly, and you must plan accordingly.
What are the four types of cryptocurrencies?
The four primary categories are utility, payment, security, and stablecoins. In addition to DeFi tokens, there are also NFTs and asset-backed tokens. The most prevalent cryptocurrencies are utility and payment tokens.
How much crypto should I buy as a beginner?
You should invest between 5% and 30% of your financial money in cryptocurrencies, with most experts deeming 5% to be quite safe and 30% to be extremely dangerous.
Is it worth investing in crypto?
Cryptocurrency could be a decent investment if you are ready to understand that it is a high-risk bet that might pay off, but there is also a significant probability that you will lose your whole investment.
What is the best way to invest in crypto?
Cryptocurrency exchanges are the most common location to acquire cryptocurrency. This is particularly true given that many exchanges let you earn interest when you offer liquidity to the exchange.
Can you get rich in Nigeria with crypto?
There are over 20,000 tradable cryptocurrencies, but many, if not the majority, might never amount to anything.
If you want to generate long-term riches, you must invest in cryptos with staying power, even though you could get fortunate and earn money trading any cryptocurrency.