Crypto is causing fiat to lose value?

[MrSpasybo]

Crypto-currency is being accepted in many places as a form of payment to replace fiat, so sometimes crypto is considered by governments as a risk that affects the right to regulate the national economy. However, I never thought that someone could say that crypto is the cause of fiat's devaluation. At least until Nigeria's Presidential Adviser shared his views.

The adviser argues that cryptocurrency exchange platforms are exacerbating the devaluation of the naira, Nigeria's national currency. He also criticizes Binance, a leading cryptocurrency exchange, for setting exchange rates that undermine the Central Bank of Nigeria's (CBN) authority. The Nigerian government is wary of the volatile nature of cryptocurrencies and the risks they pose to economic stability. Consequently, the government is considering a comprehensive ban on crypto platforms to protect the naira and ensure fiscal discipline.

"Through a series of statements on his X account, Onanuga has called for decisive action against cryptocurrency exchange platforms, accusing them of exacerbating the devaluation of the naira, Nigeria's national currency^[1]."

I am not surprised by the series of news related to the war between the Nigerian government and Crypto:

• Feb 2021: The Central Bank of Nigeria bars banks and financial institutions from dealing in or facilitating transactions in crypto assets, embezzling money laundering and terrorism financing risks^[2].
• Dec 2023: Nigeria's central bank has lifted a ban on transacting in cryptocurrencies, while saying global trends had shown a need to regulate such activities^[3].
• Jan 2024: Nigeria's central bank released has inaugural guidelines for banks opening cryptocurrency accounts, while retaining its ban on them holding or trading in virtual assets on their own behalf^[4].

But it seems Nigeria's Presidential Adviser is confusing Reason and Result: The Reason was Nigeria's economic downturn, which led to the devaluation of fiat, Resulting in people choosing to accumulate crypto to protect their assets. The Presidential Adviser may have its own opinion, but NGNUSD data does not lie.

NGNUSD chart shows that over the past decade, NGN has lost 90% of its value compared to USD. I don't think this is a result of the emergence of crypto in Nigeria. In NGN's devaluation scandal, crypto is innocent!

I count this intentional confusion as intentional deception to cause misunderstanding among people with little understanding of the crypto market. For those holding crypto, these lies will have no impact whatsoever, they understand that crypto is helping them protect their assets and avoid the risks of fiat's crazy devaluation.

What do you think about this Presidential Adviser's slander against crypto? Will this become a new behavior that other governments can learn to crack down on crypto?
[1] Nigeria's Battle with Crypto: Presidential Adviser Calls for Crackdown on Exchange Platforms
[2] Nigeria's banks barred from cryptocurrency transactions -central bank
[3] Nigerian central bank lifts ban on crypto trading
[4] Nigeria slaps strict rules on banks after lifting crypto ban

[SamReomo]

Nope crypto isn't causing fiat devaluation. The value of fiat is losing due to various reasons and one of which is the corrupt politicians who hold leadership positions in a country.

Another cause for devolution of a currency is overprinting of it, which's a main concern when it comes to a currency's value.

When current account of a country gets in deficit that also causes inflation and loss of value of that country's fiat currency.

I'm not sure why Nigeria's currency is losing its value but I'm very sure it's not losing its value because of crypto-currencies.

[electronicash]

national currency losing its value is always due to inflation and printing their currency as it equates to printing counterfeit.  but of course the CBN will not point fingers to themselves but to someone to blame to and they see crypto. are they still convincing people to use their e-naira?

this is a cheap attempt to paint crypto the negative image. i wouldn't be surprised if they will start promoting the government backed crypto exchange or their government will start using USD as their currency completely abandoning e-naira.

[TomPluz]

Crypto-currency is being accepted in many places as a form of payment to replace fiat, so sometimes crypto is considered by governments as a risk that affects the right to regulate the national economy. However, I never thought that someone could say that crypto is the cause of fiat's devaluation. At least until Nigeria's Presidential Adviser shared his views.

I am sure Presidential Adviser Bayo Onanuga is braking at the wrong tree and he can also be a wrong dog, in the first place. In case the government will listen to this man, he can be doing a great disservice to his country and his people by limiting their participation in the emerging cryptocurrency industry which one or another can be making an impact for Nigeria's economy if the government will play it well with good strategy and policies. Cryptocurrency has nothing to do with his country's falling value as it is tied to how the government is doing its well in steering the economy and not doing stupid polices like unlimited money printing and closing its door for investments from the outside. Other countries in the African continent are now looking at how they can take advantage of the cryptocurrency movement by passing regulations friendly to fintech companies and crypto-related firms domestic and abroad. Let's hope that this man's voice will be drown by protest by Nigerians who are making good in cryptocurrency and will not allow his POV to be adopted by the government. 

[KryptoBull]

NGNUSD chart shows that over the past decade, NGN has lost 90% of its value compared to USD. I don't think this is a result of the emergence of crypto in Nigeria. In NGN's devaluation scandal, crypto is innocent!

I count this intentional confusion as intentional deception to cause misunderstanding among people with little understanding of the crypto market. For those holding crypto, these lies will have no impact whatsoever, they understand that crypto is helping them protect their assets and avoid the risks of fiat's crazy devaluation.

What do you think about this Presidential Adviser's slander against crypto? Will this become a new behavior that other governments can learn to crack down on crypto?

These are just words to make people shift their blame to crypto when fiat depreciates and temporarily forget or ignore the stagnation of the economy and the incapacity of the government in the operating process. Rates on exchanges are determined by the local fiat/USD rate only, investors decide for themselves to trade. If there is a large difference, many people will participate in buying and selling to make a profit, helping the local fiat/USDT rate return to a reasonable level. Many other countries also have fiat transactions with USDT but they do not blame such exchanges.

This action only shows the advisor's irresponsibility, hope people in Nigeria will not be so easily deceived. They should understand the truth and switch to using crypto to protect their assets, they cannot put their trust in their government anymore.

[Baofeng]

This is just another excused coming from the Nigerian government. Who is the right frame of mind would accused crypto as the one causing devaluation of their local fiat? It's the government that should be blame for it.

However, they can't really stop crypto in Nigeria, it's one of the biggest cryptocurrency usage remains the highest in Africa. Just sad that they will have to take a hard line stance, and our crypto brothers in Nigeria will have to suffer the consequences just because their government is trying to blame that had happen to their economy on crypto.

[Cryptsafe]

The currency valuation of every nation depends on how good a nation's economy is. A country can not just begin to lose value in their currency because it lifted the ban on cryptocurrency just a few months ago. I think the person giving such an excuse lacks knowledge of how cryptocurrency works. He is ignorant of the fact that the world is far gone beyond that era of analogue economy and engagements but rather digital.

Nigeria is a nation that imports virtually everything when the nation and its citizens are willing to produce. They have the capacity but the government and the leadership are bent on frustrating the efforts of her citizens in producing for local consumption. Those guys are just old forks bereft of ideas to move the economy forward but looking at what to use gives excuses for their incompetency.

[Zed0X]

After money laundering, it's fiat devaluation now? Never heard of that before. The one accusing crypto exchanges as the cause of this should release a full report and state how so. They like to throw big words as if the people will just accept it without further explanation.

[notblox1]

If crypto didnt exist there would be something else that would be used instead, maybe precious metals like gold.
Fiat money is printed from nothing all the time and that is causing it to lose value non-stop, because there is no backing for this.
Monopoly money is probably worth more because it is not printed like that 

[gunhell16]

If I look at the title you made, I think that right now, or in the generation we have today, we are not yet in a situation where fiat loses its value in any country because of cryptocurrency or Bitcoin.

Then again, Bitcoin, or cryptocurrency, was not created to remove the value of any fiat in every country around the world. Instead, it can even contribute to the good economy of a country that will accept good things here. Right now, for me, "Cash is King," but in terms of digital currency, Bitcoin is King, and we know that here in the field of the crypto industry.

[elbans89]

If I look at the title you made, I think that right now, or in the generation we have today, we are not yet in a situation where fiat loses its value in any country because of cryptocurrency or Bitcoin.

Then again, Bitcoin, or cryptocurrency, was not created to remove the value of any fiat in every country around the world. Instead, it can even contribute to the good economy of a country that will accept good things here. Right now, for me, "Cash is King," but in terms of digital currency, Bitcoin is King, and we know that here in the field of the crypto industry.

Actually, fiat and crypto have their respective functions.  Fiat is King in transactions, both manual and online transactions.  Bitcoin is king in the world of digital currency investment.  So I don't think crypto takes away the value of fiat money for now.  But it doesn't rule out the possibility that it will happen in the future.

[target]

The Nigerian Bank blames crypto for the fall of their fiat. They were the ones printing notes and then they blame it to crypto but this is the way to say to the public to not worry because they will ban crypto.

[LogitechMouse]

The government is the one to blame for that one, not cryptocurrencies.

I guess we all agree that the government of Nigeria is corrupt. People there are struggling every single day. People there are having a hard time buying the things that they need to buy daily while the government, on the other hand, is pretending that nothing's happening bad on the country.

Well, those who know more about crypto know that it isn't the reason why that's happening. Inflation + bad government = currency value going down. They can blame crypto, but those who are involved in crypto know that it isn't the main reason for what's happening with their fiat currency. That chart though. It's like stairs

[bitterguy28]

national currency losing its value is always due to inflation and printing their currency as it equates to printing counterfeit.  but of course the CBN will not point fingers to themselves but to someone to blame to and they see crypto. are they still convincing people to use their e-naira?

how many countries have we seen now that printing lots of currencies and making its almost valueless .
I hate seeing my country having this so lets see whom to blame.

this is a cheap attempt to paint crypto the negative image. i wouldn't be surprised if they will start promoting the government backed crypto exchange or their government will start using USD as their currency completely abandoning e-naira.

well they will keep trying mate remember that crypto had been the pain in government and banks asses so they wanted to see it burned.

[therozaq]

Why is crypto the cause of the decline of fiat currency?
 Crypto is always used as an excuse for fiat problems.  Shouldn't the government be blamed for not being able to maintain the value of its fiat currency?  And isn't inflation an old problem that will always attack fiat... it sounds funny, if crypto is considered a problem.