The Clash Between Traditional Banking Systems and Crypto Currencies: a Nigerian Perspective

Student: Hassan Ahmad (Thesis, 2025)
Department of Economics
Sokoto State University, Sokoto, Sokoto State

Abstract

ABSTRACT This study looks at the growing conflict between traditional banks and cryptocurrency in Nigeria. Many Nigerians are turning to cryptocurrency because traditional banking is expensive and inefficient. High transaction fees, inflation, and the weakening of the Naira are pushing people to use digital currencies for savings, remittances, and payments. Despite the Central Bank of Nigeria's (CBN) ban on cryptocurrency, people are still trading through peer-to-peer platforms that do not rely on banks. The study finds that cryptocurrency can help improve access to financial services, especially for those without bank accounts, but it also challenges traditional banks. However, there are risks involved, such as fraud and price fluctuations, because cryptocurrency is largely unregulated. The study concludes that Nigeria needs a balanced approach to regulate cryptocurrency, protecting consumers while allowing new financial technology to grow. Recommendations include creating clear regulations, improving public understanding of cryptocurrency, and encouraging traditional banks to adopt digital services. This research helps explain how cryptocurrency is changing the financial system in Nigeria and how it can work alongside traditional banking.

Keywords
Traditional banking cryptocurrency Nigeria financial technology blockchain digital currency banking system crypto adoption monetary policy Central Bank of Nigeria
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