Nigeria’s inflation rate climbed to 34.80% in December 2024, a marginal increase from 33.60% in November, according to the latest Consumer Price Index (CPI) report from the National Bureau of Statistics (NBS).

This marks yet another month of inflationary pressure, underscoring the persistent challenges facing the country’s economy. The NBS attributed the rise to increased demand for goods and services during the festive period, but experts argue that deeper structural issues are driving the unrelenting inflation.

On a year-on-year basis, the December 2024 inflation rate was 5.87 percentage points higher than the 28.92% recorded in December 2023, reflecting the severity of price increases over the past year. However, on a month-on-month basis, the headline inflation rate eased slightly to 2.44% in December from 2.64% in November, indicating a marginal slowdown in the rate of price increases within the month.

Food Inflation Remains Alarmingly High

Food inflation, a critical component of Nigeria’s overall inflation, rose to 39.84% on a year-on-year basis in December 2024, up from 33.93% in December 2023. The NBS attributed the surge to significant price increases in staples such as yam, water yam, sweet potatoes, beer, maize grains, rice, and dried fish. These items form the backbone of many Nigerian diets, making the rising prices especially impactful on households.

On a month-on-month basis, however, food inflation declined to 2.66% in December from 2.98% in November. The slight drop was attributed to reduced prices in items like local beer (Burukutu), fruit juice, malt drinks, rice, maize flour, and water yam. Despite this monthly decline, the year-long trends reveal a broader crisis in the food sector.

The average annual food inflation rate for 2024 stood at 39.12%, an increase of 11.16 percentage points from the 27.96% recorded in 2023, further underscoring the worsening food affordability for most Nigerians.

Inflation’s Uneven Impact Across States

Inflationary pressures have not been evenly distributed across the country. States such as Sokoto (57.47%), Zamfara (46.39%), and Edo (46.32%) recorded the highest food inflation rates on a year-on-year basis in December 2024. In contrast, Ogun (34.24%), Rivers (35.43%), and Kwara (35.58%) experienced the slowest increases.

On a month-on-month basis, food inflation remained highest in Kogi (6.53%), Sokoto (6.21%), and Cross River (5.90%), while Yobe (-3.21%), Kano (-1.29%), and Abuja (-0.79%) saw declines.

Underlying Causes of Persistent Inflation

Despite repeated efforts by the government to control inflation, the consistent rise over recent months highlights the ineffectiveness of current policies. Analysts attribute the inflationary pressure largely to two key factors: the high cost of food and the devaluation of the naira. The devaluation, which has significantly weakened the local currency, has made imports more expensive, driving up costs across the board, particularly for food and essential goods.

Transportation costs, which have soared due to the removal of fuel subsidies earlier in the year, have further exacerbated the situation. With fuel prices remaining high, the cost of moving goods, especially agricultural produce, has surged, leading to sharp increases in food prices.

The persistent rise in inflation has led to growing calls for the government to adopt a more comprehensive approach to tackling Nigeria’s economic crisis. The suggestion to reopen borders and ease restrictions on food imports has been particularly prominent. Experts argue that these measures would help increase the supply of food, thereby reducing prices and alleviating some of the pressure on households.

Additionally, analysts have emphasized the need for improved transportation infrastructure and policies to reduce logistics costs, a major driver of food inflation. Subsidies or incentives for local food producers have also been touted to help stabilize prices in the long term.

TikTok, the social media giant owned by Beijing-based ByteDance, plans to cease operations in the United States on Sunday, January 19. This coincides with the enforcement of a federal law banning the app in the country, marking the culmination of years of scrutiny over its ties to the Chinese government.

TikTok’s shutdown decision exceeds the requirements of the ban, which prohibits new downloads and updates but allows existing users to retain the app. Instead, TikTok will cut off access entirely, directing users to a webpage about the ban and providing options to download their data.

The shutdown will impact TikTok’s estimated 170 million monthly active U.S. users, many of whom rely on the app for entertainment, community engagement, and income. The decision marks a significant turning point in the fraught relationship between the U.S. government and ByteDance, highlighting broader concerns over national security, privacy, and digital sovereignty.

The Road to the Ban

TikTok’s troubles in the U.S. date back to the Trump administration, when then-President Donald Trump first proposed banning the app over fears it could serve as a surveillance tool for the Chinese government. Though that effort failed, bipartisan concerns over TikTok persisted, culminating in the 2024 passage of a federal law mandating ByteDance to divest its U.S. operations or face a ban.

Lawmakers have pointed to Chinese laws requiring companies like ByteDance to share user data with the government upon request as a primary concern. Despite ByteDance’s repeated denials and assurances that TikTok operates independently of the Chinese government, U.S. officials remain unconvinced.

The Biden administration continued the scrutiny, eventually signing the ban into law in April 2024. While the law does not explicitly mandate the app’s immediate shutdown, TikTok’s decision to cease operations altogether underscores the challenges ByteDance faces in navigating a highly politicized environment.

American Users Switch to RedNote

TikTok’s departure leaves a gaping void in the American digital landscape. The app has become a cultural phenomenon, known for its short-form videos that span entertainment, education, activism, and beyond. Creators, many of whom have built careers and livelihoods on TikTok, now face the prospect of losing their primary platform overnight.

In the lead-up to the ban, American users have explored alternatives, with Chinese-owned apps like Xiaohongshu (marketed as RedNote in the U.S.) and Lemon8 experiencing a surge in downloads. RedNote, a platform focused on social sharing and community engagement, has emerged as a surprising beneficiary of TikTok’s downfall. Despite technical glitches and account moderation issues, over 700 million TikTok users have migrated to the app, creating a new space for cultural exchange. American users have helped Chinese users with English skills while learning Mandarin in return.

The migration to RedNote, whose default language is Mandarin, has sparked an unexpected spike in Mandarin learners in the U.S. Duolingo, a popular language-learning app, has reported a 216% year-over-year increase in new Mandarin learners, with a sharp spike in mid-January as RedNote adoption accelerated. Downloads of Duolingo itself also surged, rising by 36% across the App Store and Google Play, according to data from app intelligence provider Appfigures.

Duolingo’s rise in the app rankings—from the 40s to No. 22 in Top Overall and No. 20 in Top Apps—reflects the growing interest in learning Chinese among Americans navigating the shift from TikTok to RedNote. Many new Duolingo users cited TikTok as their motivation for picking up Mandarin, demonstrating the app’s continued cultural influence even in its final days of operation.

While concerns over ByteDance’s potential data-sharing with the Chinese government were central to the ban, the mass migration to RedNote indicates that many American users are not overly worried about data privacy. Instead, their actions signal a demand for the type of innovative and engaging social networking experiences that TikTok pioneered, which U.S. competitors like Meta have struggled to replicate.

For TikTok’s competitors, the ban also represents an opportunity and a challenge. Companies like Instagram and YouTube, which have developed TikTok-inspired features such as Reels and Shorts, may see a boost in usage. However, the surge in RedNote downloads demonstrates that users are willing to explore alternatives outside the U.S. tech ecosystem, particularly those with unique offerings.

While some users hold out hope for a last-minute resolution, TikTok’s operations in the U.S. appear to be drawing to a definitive close. The Biden administration is reportedly exploring ways to allow TikTok to remain operational, potentially through a forced sale of its U.S. assets. However, ByteDance has shown little willingness to divest its ownership, and the political climate remains hostile to any compromise.

Franklin Templeton has highlighted the intersection of artificial intelligence (AI) and cryptocurrency in their 2025 outlook, focusing on the potential of AI agents operating within blockchain networks. They predict that AI agents could revolutionize content generation on social media and play significant roles across various industries and platforms.

This convergence of AI and crypto is expected to provide transparency and verification for AI-driven economies, with AI agents potentially automating on-chain transactions and managing portfolios. Franklin Templeton sees this as an exciting development, although they acknowledge that these agents are still in early stages with limited utility currently. However, the asset manager believes this sector holds significant promise for the future.

AI Agents are autonomous software entities that can perform tasks based on AI algorithms. In the context of blockchain, these agents operate within decentralized networks to execute smart contracts, manage data, or make decisions based on predefined criteria. AI can enhance smart contracts by making them adaptive or capable of interpreting complex conditions beyond simple if-then logic.

AI agents can analyze on-chain data for patterns, anomalies, or predictive analytics, enhancing the blockchain’s data utility. They can automate and optimize transactions, from simple transfers to complex trading strategies in DeFi (Decentralized Finance).

BlackRock’s Head of Digital Assets, Robert Mitchnick, has indicated that despite significant advancements in 2024, Bitcoin adoption remains in its infancy, particularly within wealth advisory and institutional sectors. This perspective underscores a belief that the current phase is just the beginning of Bitcoin’s journey into mainstream finance.

Institutional Engagement: There’s an acknowledgment that while retail interest in Bitcoin has been strong, institutional adoption is proceeding at a slower pace. However, BlackRock has observed an increase in institutional players, especially in the last quarter of 2024, indicating a gradual shift towards broader acceptance.

Educational Efforts: BlackRock emphasizes the importance of educating clients about Bitcoin ETFs, highlighting the novelty of such products and the need for continuous investor education to facilitate understanding and adoption.

ETF Impact: The introduction of Bitcoin ETFs, like BlackRock’s IBIT, has been a significant step in making Bitcoin more accessible to traditional investors. These vehicles have seen record inflows and are viewed as a bridge for investors who might find direct investment in Bitcoin challenging due to security, custody, or complexity issues.

Global and Demographic Trends: BlackRock notes that Bitcoin’s adoption rate has outpaced both mobile phones and the internet, attributing this to demographic trends where younger generations are more inclined towards digital assets, as well as macroeconomic factors like inflation fears and geopolitical uncertainties.

Portfolio Inclusion: BlackRock has also provided guidance on portfolio allocation, suggesting that Bitcoin could constitute 1% to 2% of a multi-asset portfolio, akin to the risk profile of major tech stocks, indicating a strategic view of Bitcoin as part of investment diversification.

Volatility and Future: There’s a caution that broader adoption might lead to less volatility in Bitcoin’s price, potentially reducing some of the asset’s allure for those seeking high returns from price movements. However, this stability could also make Bitcoin more appealing for long-term investors.

This analysis from BlackRock suggests a nuanced view of Bitcoin’s place in the financial ecosystem, where while there’s been notable progress, the potential for growth and integration into traditional finance is still vast. The focus on education, institutional adoption, and strategic investment positions highlights BlackRock’s belief in Bitcoin’s long-term value and utility.