Forex and Crypto which are most traded in Nigeria today?

By: Damian Okonkwo

The desire for easy money-making business has driven more Nigerians to embrace cryptocurrency trading more than Forex trading. Forex trading no doubt requires a lot of discipline and mastery to make money in the industry. Similarly, most pairs are offered as CFDs in Forex which increases the risk the trader is exposed to as loss could exceed one's capital if not controlled. Nigerians no doubt do not have an organized academy for the young traders to carry out extensive research into forex trading skills and requirements. To this end, many Nigerians find it easy to adapt to cryptocurrency trading rather than forex. The ratio of cryptocurrency traders to Forex traders in Nigeria today is 2:1. Many would suppose that the number of Forex traders which is a legal business in Nigeria would have been greater but this is hardly the case today. Nigerians have little patience to learn about the complex forex market, especially the fundamental and technical dimensions. Hence they quickly dabble into Cryptocurrency trading as the domain for easy profits making.

What are the major advantages of Cryptocurrency trading over forex trading？

« A. Legal ownership of assets in Cryptocurrency trading: There is a fair acceptance that “spot trading” obtainable in cryptocurrency trading is more advantageous than CFD trading obtainable in forex. This is because, in spot trading, the crypto investor obtains legal ownership of the coins purchased. The prices could fall without his losing the assets and quantity purchased. On the contrary, the Forex trader has no legal ownership of the assets purchased as CFDs in Forex. He stands the chance of losing the whole assets based on the signed contract if the loss exceeds his capital. Not every trader is willing to take such risks, hence they resort to spot trading in cryptocurrency as an alternative investment.

« Bullish Season advantage in Cryptocurrency trading: The fact that cryptocurrency trading is divided into bullish and bearish seasons makes it an easy profits making business for investors who invest heavily into a strong crypto project during the bull run and take profits when they have gotten high returns. The bullish season gives traders the assurance and confidence to invest that they are less likely to lose their investment. Hence we find a great number of Nigerian investing in cryptocurrency during the bullish season rather than forex.

Nevertheless, the fact that a greater number of Nigerian traders prefer cryptocurrency trading over forex trading does not undermine the benefits of forex trading too. Forex trading is only profitable with the right education and understanding of the market structure.