Reasons For The Growing Bitcoin Market In Africa
By: Date: October 12, 2020 Categories: Finance

Africa is witnessing a rise in the use of cryptocurrencies. According to a report named The State of Crypto in Africa by Arcane Research and Luno, the country is witnessing far more crypto ownership, increased trade volume, and even certain regulations being imposed on the cryptocurrency market. Among the many African countries, a few nations such as South Africa, Kenya, Nigeria, Uganda, Ghana, and others are among the top countries to search for Bitcoin on Google. The report also claims Africa to be one of the top continents in the world to adopt cryptocurrencies speedily. Even though Africa is quite diversified, there are certain similarities among the different African nations. Almost all countries are going through economic issues such as volatile currency rates, high inflation rates, lack of proper banking infrastructure, and pushing governments to find alternate developments. Some of the most popular cryptocurrencies in African countries are Bitcoin, Lisk, and Dash that are in high demand in South Africa, Kenya, Ghana, Nigeria, Zimbabwe, and Botswana.   

Mobile money has been a hit in Africa, and investors around the world recognize this benefit. Apart from that, there has been a race among investors to take advantage of the growing demand for mobile money in African countries. Recently, Jack Dorsey, the CEO of Twitter, showed interest in investing in the crypto market in Africa. During the recent Crypto Finance Conference, the host of the show, Nicolo Stoehr, also emphasized the opportunities for cryptocurrencies in Africa. Seychelles has been positioning itself as a crypto hub among the different African nations, just like Malta, Zug, Jersey, and Caymans. All of these are actively offering positive crypto regulations and tax-neutral setting to bring in crypto-investors.

With the increase in the demand for cryptocurrencies, South Africa most recently released about 30 recommendations to regulate cryptocurrency and other related services. The policy is in regard to the published standards by FATF. In Kenya, many companies are accepting payments through Bitcoin for rendered services. Just last year, the total bitcoin transaction in the country was $1.5 million, and it was even after the Central Bank of Kenya warned against the volatile nature of Bitcoin. As the popularity of cryptocurrencies grows, the demand and the transactions are also expected to grow further. Even Nigeria is not far behind when it comes to accepting Bitcoin for products and services. There are plenty of different local platforms, such as Nairaex, that allow locals to buy and sell BTC.

Bitcoin was created back in 2009 and steadily become one of the widely used cryptocurrencies in the world. The popularity of cryptocurrencies in Africa is due to the popularity of Bitcoin. The reason is that Bitcoin is decentralized and is owned by individuals and not by any institution. African countries are seeing Bitcoin as a potential opportunity. It is being seen as a platform to allow African countries to reduce corruption, improve governance, and promote development. Around 15 cryptocurrency-related work started in Africa last year alone. Set up in 2013, the Luno Exchange now has more than 1.5 million customers spread across 40 countries. In addition, other remittance services are pushing the popularity of cryptocurrencies in Africa even further.

However, there is a greater need for proper infrastructure in Africa for cryptocurrencies to be fully adopted by the people. The African countries’ government needs to clear their position on cryptocurrencies since a number of non-African countries already have a ban on cryptocurrency-usage. With improved internet connectivity and better regulations, there is no doubt that Africa will become one of the major hubs for crypto-related services in the world.