The Growing Adoption of Cryptocurrency in Africa
It’s an undisputed fact that crypto has become widely accepted in Nigeria and Africa at large. This is because people now prefer to use digital currencies over fiat cash. Africans can now easily buy bitcoin and sell it on exchanges. Cryptocurrency has served as an alternative source of income for most Nigerian and African Youth. This is because trading and cryptocurrency investment doesn’t require a lot of money to begin and are easily accessible.
Africans are increasingly becoming more interested in digital currency. Economists have also predicted that cryptocurrency will help in the development of the continent. There are no geographic restrictions for bitcoin because it is a digital currency governed by blockchain technology.
The blockchain stores the details of every transaction. These transactions are recorded on a ledger. The major difference between Visa/Mastercard and cryptocurrency is that the former is regulated while the latter is not government regulated. Nigeria is currently the second-largest bitcoin trading market behind the USA. Citizens and residents of countries where inflation is high will definitely prefer to do transactions using cryptocurrency.
What are cryptocurrencies?
Cryptocurrencies are digital currencies that are built on an innovative technology called the blockchain. The wide usage of cryptocurrency is because of its ease of use and tax-free nature. Small and large businesses can use cryptocurrency for finance processing. Anyone and everyone can now easily make cross-border payments using crypto.
On the other hand, cryptocurrency is also a digital investment asset. Holding valuable cryptocurrencies for an extended period will yield interest despite the high volatility of the crypto market. This is why Africans and most especially Nigerians are actively involved in cryptocurrency investments.
Find out which is more profitable for Nigerians – Bitcoin trading or Bitcoin investment?
Bitcoin and altcoins are now widely accepted in different African countries, and people use them to make and receive payments. Due to the ease of use, Individuals and businesses are beginning to use cryptocurrencies to complete transactions.
Cryptocurrency in Africa
Although lots of Africans have adopted the use of cryptocurrency this adoption is not limited to Bitcoin. Some other cryptocurrencies that Africans have adopted include Litecoin, Bitcoin Cash, Ripple, and Ethereum among many others. The high rate of cryptocurrency adoption in Africa can be traced to the instability and the dwindling value of the local currencies. This is why most Africans feel it is better and safer to have their money in digital assets.
Both Individuals and businesses see cryptocurrency as one of the best ways to send and receive funds. Crypto has made e-commerce shopping and paying contractors/suppliers across borders easier. Cryptocurrency has also made it easy for individuals to send funds to their family relatives living abroad. Unlike conventional international payments, you don’t need to pay extra charges, and you don’t need to pay maintenance fees.
Cryptocurrency trading can be very lucrative, and Africans are hugely taking advantage. With peer-to-peer exchanges like Remitano, Nigerians can now easily buy bitcoin in Nigeria and begin their trade journey. The high exchange rate between local currencies and dollars makes trading even more profitable for Africans.
Additionally, Africans living in cities like Lagos, Port Harcourt, Johannesburg are more digitally inclined. They have access to high-end phones, computers, iPads, and lots more. These devices make it easy for them to carry out their trades with just a click.
Use of Blockchain
Blockchain technology is not only useful for cryptocurrencies, it is also used to build new technological solutions by tech giants and startups. This has made their business easier and better. It is also essential to add that in Africa, most startups and businesses also welcome payment in cryptocurrencies like bitcoin cash, bitcoin, ripple, ethereum, etc.
Africa and Cryptocurrency
There are several local and international crypto exchange platforms such as Remitano and Binance that are serving the African market. These exchanges make it easy for Africans to buy bitcoin and other cryptocurrencies. These exchanges have reached millions of customers worldwide, and have helped make cryptocurrency-related businesses operate easily in Africa.
Nigeria currently has the largest economy in Africa, and even though crypto is not regulated in Nigeria, Nigerians especially the youth have fully accepted cryptocurrency. The recent ban on crypto transactions by the Central bank of Nigeria doesn’t seem to faze crypto traders and investors in Nigeria as this has not had any negative effect on the volume of crypto transactions in the country.
The central bank of Nigeria banned its commercial banks from carrying out crypto transactions and all bank accounts linked to the purchase and sale of Bitcoin should be terminated. On the other hand, crypto trading and investment remain legal in Nigeria however, Nigerians can no longer make direct deposits from their crypto accounts to their bank accounts. As a result, Nigerians have begun to take more advantage of reliable peer-to-peer exchanges like Remitano.
Most cryptocurrency users in Africa today are daily crypto traders. Nigerians buy bitcoin in Nigeria for trading to meet their daily needs. Although adoption of Blockchain technology is important, at the moment, most Africans simply see crypto as a way to make money online.
Most African countries are facing deficient technological development, political instability, corruption, and poor socioeconomic development: poverty and unemployment being at the forefront of these issues. This is why the African youths are adopting cryptocurrency at a rapid rate as they see the technology as a way out of the generational poverty cycle. These challenges are why Africa is a fertile land for cryptocurrency growth.
As of the time of writing this article, the adoption of cryptocurrency in Nigeria and Africa is growing at an exponential rate. The trading volume of daily cryptocurrency is way above 10 million dollars. Leading Peer-to-Peer exchanges like Remitano and Paxful have recorded a high volume of transactions from Nigeria and some other African countries. This volume is said to be growing at a very rapid rate.