Effect of Cryptocurrency Ban Policy on Unemployment Rate in Nigeria
CHAPTER ONE
PURPOSE OF THE STUDY
The apex grail of this study is to investigate the effect of Cryptocurrency Ban Policy on Unemployment Rate in Nigeria. Other specific objective include;
- Identify the impact of cryptocurrency on the economy of Nigeria.
- Investigate the effect of cryptocurrency on the finance need of unemployed Nigeria citizens.
- Examine the effect of cryptocurrency ban on Nigeria crypto traders.
- Investigate if cryptocurrency was an opportunity for unemployed Nigerians.
CHAPTER TWO
LITERATURE REVIEW
INTRODUCTION
Our focus in this chapter is to critically examine relevant literatures that would assist in explaining the research problem and furthermore recognize the efforts of scholars who had previously contributed immensely to similar research. The chapter intends to deepen the understanding of the study and close the perceived gaps.
Precisely, the chapter will be considered in two sub-headings:
- Conceptual Framework
- Chapter Summary
CONCEPTUAL FRAMEWORK
CRYPTOCURRENCY
The year of 2007 set a new rhythm when it comes to the financial sector and how much people were willing to trust the system. After the crisis, many people who had lost everything, or almost everything, had to turn the page and look for new possibilities. The end of the last decade opened the door for new opportunities, and cryptocurrencies were right around the corner when it happened, which led to a great opportunity for many people who wanted to invest their money on something totally different and with a good growth margin. “In the 19th century, you could find a dollar coin made of silver and a paper dollar that in those days could be exchanged for the same silver coin. More than 100 years ago paper dollar bills were backed by silver, a precious metal that theoretically should always have value. However, today that has changed, a modern dollar bill is backed by nothing but the word of the U.S. government.” (Rose, 2015: 617). Nowadays, cryptocurrencies are a daily topic. But what are exactly cryptocurrencies? The first thing we need to understand is how to settle the difference between a virtual currency, a digital currency and a cryptocurrency, because these are often used interchangeably. The European Central Bank released an article about “Virtual Currency Schemes” in October 2012, where virtual currency was defined as a” type of unregulated, digital money, which is issued and usually controlled by its developers, and used and accepted among members of a specific virtual community”. A digital currency can be defined as a form of virtual currency that is electronically created and stored. A digital currency can or cannot be a cryptocurrency. And last, a “cryptocurrency can be defined as a subset of digital currencies, however, it uses cryptography for security so this makes it extremely difficult to counterfeit” (Gilpin, 2014).
When referring to cryptocurrencies, it is precisely all about a certain type of virtual currencies. Rogojanu and Badea (2015) stated that “virtual currency continues to maintain the main features of a traditional currency, in other words, virtual money is a symbol or synonym for a value, a payment system technology which continued to grow over the past 20 years”. However, due the newness of this phenomenon and its rapid growth, suggesting a universal definition of cryptocurrency is still a challenge. Abboushi (2016), from Duquesne University tries to explain it according to four core dimensions: (1) virtual currency is a form of digital currency which is digital representation and measurement of economic value for an object or transaction; (2) it is issued by non-government party and remitted for the exclusive use by another private party; (3) it is denominated in units of account of its own system that may or may not be exchangeable to real currency; (4) it is used as a medium of exchange similar to real currencies but does not have legal tender status in any jurisdiction in the world. Sauer (2016), describes cryptocurrency as money which does not exist in reality as coins, banknotes or bank deposits, but rather exists in digital form.
CHAPTER THREE
RESEARCH METHODOLOGY
AREA OF STUDY
Lagos, sometimes referred to as Lagos State to distinguish it from Lagos Metropolitan Area, is a state located in the southwestern geopolitical zone of Nigeria. The smallest in area of Nigeria’s 36 states, with a population of over 15 million, Lagos State is arguably the most economically important state of the country, containing Lagos, the nation’s largest urban area. (Wikipedia.com)
RESEARCH DESIGN
Research designs are perceived to be an overall strategy adopted by the researcher whereby different components of the study are integrated in a logical manner to effectively address a research problem. In this study, the researcher employed the survey research design. This is due to the nature of the study whereby the opinion and views of people are sampled.
POPULATION OF THE STUDY
According to Udoyen (2019), a study population is a group of elements or individuals as the case may be, who share similar characteristics. These similar features can include location, gender, age, sex or specific interest. The emphasis on study population is that it constitute of individuals or elements that are homogeneous in description.
CHAPTER FOUR
DATA PRESENTATION AND ANALYSIS
INTRODUCTION
This chapter presents the analysis of data derived through the questionnaire and key informant interview administered on the respondents in the study area. The analysis and interpretation were derived from the findings of the study. The data analysis depicts the simple frequency and percentage of the respondents as well as interpretation of the information gathered. A total of sixty five (65) questionnaires were administered to respondents of which fifty (50) were returned and validated. This was due to irregular, incomplete and inappropriate responses to some questionnaire. For this study a total of 50 was validated for the analysis.
CHAPTER FIVE
SUMMARY, CONCLUSIONS AND RECOMMENDATIONS:
Introduction
This chapter summarizes the findings into the assessment of the effect of cryptocurrency ban policy on unemployment rate in Nigeria. The chapter consists of summary of the study, conclusions, and recommendations.
Summary of the Study
In this study, our focus was to the assessment of the effect of cryptocurrency ban policy on unemployment rate in Nigeria using Lagos state as case study. The study specifically was aimed at investigating if the CBN crypto ban policy has any negative effect on crypto unemployment rate in Nigeria.
The study adopted the survey research design and randomly enrolled participants in the study. A total of 50 responses were validated from the enrolled participants where all respondent are were Cryptocurrency investors.
Conclusions
Based on the findings of this study, the researcher made the following conclusion.
- CBN Crypto ban policy Increase in the level of poverty and unemployment rate.
- CBN Crypto ban policy discouragedcrypto investors in Nigeria.
- Cryptocurrency ban policy doeshave a negative effect on Crypto investors in Nigeria.
RECOMMENDATIONS
Based on the findings of this study, the researcher made the following recommendation.
Having known the huge economic impact made by the availability and trade of cryptocurrencies in Nigeria and the world at large, it seems not right to impose a ban on it due to the economic implications. Therefore, the CBN should lift the ban and build a strict regulations on the use and trading of Cryptos in Nigeria, by this means, many Nigerian investors both the huge and small will bounce back to their financial position and so many others who has been jobless will successfully secure a source of income. This will in turn reduce the pressure of Unemployment in Nigeria.
REFERENCE
- Abboushi, S. 2016. Global virtual currency – brief overview. Competition Forum 2016, Vol 14: 230-237.
- Angela, S. M., Irwin, S. J., Kim-Kwang, R., Lui, L. 2014. Money laundering and terrorism financing in virtual environments: A feasibility study. Journal of Money Laundering Control, 17 (1): 50-75.
- Bjerg, O. 2016. How is Bitcon Money?. Theory, Culture and Society 2016, Vol. 33(1), 53-72.
- Bovaird, Charles; Are Bitcoin And Gold Prices Correlated?; https://www.coindesk.com/bitcoin-gold-prices-correlated/, posted on August 2nd 2016.
- Bovaird, Charles; Why Bitcoin Prices Have Risen More Than 400% This Year; https://www.forbes.com/sites/cbovaird/2017/09/01/why-bitcoin-prices-have-risen-more-than400-this-year/#3b7d3ba66f68, posted on September 1st, 2017.
- Burniske, C., White, A. 2017. Bitcoin: Ringing The Bell For A New Asset Class. ARK Invest Research and Coinbase.
- Chan, S., Chu, J., Nadarajah, S., Osterrieder, J. 2017. A Statistical Analysis of Cryptocurrencies. Journal of Risk and Financial Management, 10, 12.
