Naira becomes first fiat currency on Binance

Binance listed the first fiat trading pair, and it’s not the US dollar. Starting from today, Nigerian users will be able to buy Bitcoin, Binance Coin (BNB), and Binance’s stablecoin BUSD with Naira.

Most top exchanges that provide fiat-to-crypto trading services focus on the US dollar, or at least on the euro or yen. This is because they are the most traded currencies, with the USD enjoying the status of a global reserve currency. Nevertheless, Binance went the other way by adding the national currency of an African country as its first fiat service, reports stated.

Last month, Bitcoin was the most popular particularly in Africa and especially in Nigeria. The country leads the current ranking of top regions where the Google search trends of “Bitcoin” term note the highest frequency.

Nigeria is struggling with a humanitarian crisis on its north-eastern side, which affects the economy. Citizens find it difficult to use their national currency as a store of value as Naira devalues from year to year. Now they can use Binance to buy Bitcoin, BUSD or BNB in exchange for Naira.

Binance launched the new fiat solution in partnership with the payment system, Flutterwave.

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Interestingly, USD/NGN rose almost 18% yesterday, hitting a new record high at 361. Previously, one US dollar bought about 306 Naira. The pair had fluctuated between $300 and $330 for about three years. The last time when USD/NGN traded above $350 was in the summer of 2016, and it lasted a few days only.

The recent drop demonstrates once again that Naira is an unstable currency that doesn’t deserve people’s trust. Binance’s launch came on time.

The primary reason behind the yesterday crash is a sudden decline in Nigeria’s foreign reserves. Last week, the Central Bank of Nigeria said that the reserves depleted by $5 billion in about four months, to $40.79 billion, the lowest level year-to-date and the biggest drop in 2 years.

The central bank uses foreign reserves to stabilize the markets and the national currency.

As for Binance, CEO Changpeng Zhao hinted that more fiat currencies would show up on the platform, which has been among the top 3 most popular crypto-to-crypto exchanges.