Nigerian crypto startups built their businesses on facilitating the buying and selling of digital currencies for retail customers. Now, that may no longer be enough. At least two operators say competition is compressing margins, and costs do not fall with volume, making it difficult to sustain a business solely dependent on retail trading.
The unit economics are revealing. On a typical $100 retail transaction, the gross revenue a platform earns ranges from about $0.30 to under $1.40. After deducting direct costs like payment processing and liquidity, gross profit exceeds $1.25 for one operator, while another says gross profit after all costs is just $0.30 to $0.50. Running a regulated crypto trading platform means carrying expenses that do not shrink when trading slows: staff, security, compliance, banking partnerships, and infrastructure. These costs are largely fixed, and when retail trading activity slows, revenue falls disproportionately lower than these fixed expenses.
High-frequency retail traders, called “power users,” make between 20 and 30 transactions monthly and generate a disproportionate share of revenue. Yet these customers are also the most demanding: price-sensitive, quick to move to a competitor offering tighter spreads, and unforgiving of downtime. As a result, several crypto startups operating in Nigeria, including Busha, Roqqu, Dantown, Luno, and Blockchain.com, have all expanded beyond retail crypto trading. Some, like Yellow Card, have shut down retail entirely to focus on the B2B side.
The shift is driven by the realisation that trading volume is cyclical. Peak periods in December and March can deliver 50 to 100 percent more volume per user than slow months. For platforms whose revenue is entirely tied to that cycle, the income curve is lumpy and hard to plan around. Expanding into payment-driven use cases—utility bill payments, airtime top-ups, and everyday financial services generates activity independent of crypto market cycles.
