Africa is a huge potential cryptocurrency market, as the continent seeks alternatives amid problems in the financial system
In a continent where Internet penetration is greater than access to bank accounts, the untapped potential of an end-to-end ATM system seems immense. That is exactly why cryptocurrency is often seen as a way to achieve Africa's aspirations for financial freedom. In fact, meeting these pressing needs for a decentralized global financial system was part of the vision of Bitcoin creator Satoshi Nakamoto. However, the adoption of cryptocurrencies on the continent is hampered by the numerous challenges faced in the region.
Modibe Matsepane, Africa's community coordinator on the continent's largest P2P Bitcoin trading platform, Paxful, expressed what she believed to be African sentiment towards Bitcoin in an interview with BeInCrypto yesterday: “Bitcoin was a facilitator for Africans to regain control of their money and to empower themselves. "
The cryptocurrency has certainly sparked interest in Africa. Nigeria, Ghana and South Africa were on the list of countries with the largest Google searches on Bitcoin in the world. South Africa also has the highest levels of encryption ownership in relation to Internet users in the world.
Marius Reitz, Luno's African general manager, said that a unique combination of economic and demographic trends makes Africa a promising partner for cryptocurrency.
However, for Africa, Bitcoin is much more than a speculative asset. On a continent that has the highest remittance charges in the world, Bitcoin offers a reliable method for gaining control of money. The average rate for receiving remittances from abroad is around 10%. The number is even higher for intra-continent transactions. In addition, Bitcoin offers an alternative to the disastrous policies of the central bank. Countries like Zimbabwe favor Bitcoin over their local currencies, which suffer from hyperinflation.
Emmanuel Tokunbo Darko, vice president of marketing for ICOWatchlist.com, explained to UN Africa Renewal Magazine that “Bitcoin transactions help eliminate procedural bottlenecks that affect traditional banking and financial services“.
Despite this, Bitcoin adoption in Africa continues to face a number of challenges. It costs a transaction fee of around $ 6 to send bitcoins in Africa. While this may be considered reasonable for international transactions, the fee is absurdly high for the daily use of digital currency. The speed of the transaction is another matter. Without the proper infrastructure to handle crypto transactions, it can take up to an hour for a Bitcoin payment to be processed.
African cryptocurrencies are emerging to solve these problems. From Akoin to Zimbocash, cryptography projects have started across the continent to use blockchain technology to meet the specific and unique financial needs of the African people.