CBN crypto ban aftermath: Patricia relocates headquarters from Lagos to Estonia
CBN crypto ban aftermath: Patricia relocates headquarters from Lagos to Estonia
Patricia, a Nigerian fintech company, has announced the relocation of its operations to the Republic of Estonia and the establishment of a new headquarters in the country's northeastern European region. According to the startup, the move is in response to the Nigerian government's ban on cryptocurrency trading and is part of a global expansion strategy.
According to CEO and Founder, Hanu Fejiro Agbodje, "what initially appeared to be catastrophic news turned out to be the cornerstone we needed for this global expansion." He was referring to Nigeria's apex bank, the Central Bank of Nigeria's, crypto trading ban (CBN).
Recall that on February 5th, 2021, the CBN issued a circular directing bank and other financial institutions to immediately cease transacting in/with entities trading cryptocurrencies and to close their bank accounts accordingly.
According to Hanu, the forced expansion will help them strengthen their relationships with marketers and agencies in the global crypto markets, while also positioning them to take the lead in Nigeria and Africa.
Patricia was founded in 2018 as Patricia.com.ng as an eCommerce platform for the exchange of unused iTunes, Amazon, and Google Play gift cards. Since then, Patricia has expanded to offer a variety of financial solutions in Ghana, Kenya, South Africa, and China.
It was announced as a co-headline sponsor for the sixth season of BBN, which begins in a few weeks, about three months ago by show owners Multichoice.
Just a bit about the CBN ban
The CBN order came at a time when the country's citizens were increasing their use of virtual currencies.
By early 2021, Nigeria had developed into one of the leading countries in terms of crypto trading volume and transaction value. Nigeria was the third largest Bitcoin trading country in the world, according to Statista, with approximately $400.1 million in transactions.
Nigeria's central bank stated in its directory of cryptocurrency transactions that "VCs such as Bitcoin, Ripples, Monero, Litecoin, Dogecion, and Onecoin, among others, and similar products are not legal tender in Nigeria, and thus any bank or institution transacting in such businesses does so at its own risk."
Economic and technology analysts, as well as international agencies such as the IMF, expressed strong reactions to the regulation on social media.
This backlash compelled the CBN to justify its decision to ban digital currencies. Among the primary reasons was the fact that virtual currencies were being used for criminal purposes. Additionally, cryptocurrencies obviate oversight, accountability, and regulation.
It also justified its position by stating that Nigeria is not the first country to do so, as several other countries have also prohibited Bitcoin, key industry participants, cryptocurrency mining, and or other forms of crypto activity.
The ban compelled space players to invent new models in order to survive. For example, Patricia announced the establishment of a new platform, Glover Exchange, as the new entity responsible for the day-to-day operations of its Gift cards, Airtime2Cash, and refill services (Bill Payments), but the move appears to have had little impact on the company's bottom line.
The story is similar for a large number of other players.
