The market may have been on a rollercoaster throughout 2018, but that hasn’t diminished the appetite for crypto throughout the African continent.
Oddly though, during the crypto craze of 2017, Africa was less keen on digital assets and the number of crypto traders on the continent was small. Furthermore, few people knew much about cryptocurrency. Ironically, this protected them from the losses experienced elsewhere.
Now, according to stats related to Google searches, Africa is doubling down on crypto while the rest of the world goes through a period of fear, uncertainty and doubt (FUD).
As The Merkle points out, Africa is notoriously slow to adopt technology innovations; mobile phones are an example of this. However, when African countries that did enter the smartphone market, adoption was rapid and widespread. Much of this was due to the fact that there was little existing telecommunications infrastructure in Africa, so people were quick to embrace the smartphone, because they hadn’t had fixed landlines and weren’t attached to older technology. We have seen a similar journey with cryptocurrencies.
Initially, African governments warned their citizens against getting involved with crypto, but this has lately been reversed, and as a result Africans have changed their attitude as well.
One company that is reaping the benefits is Paxful, a peer-to-peer crypto trading platform. It recently revealed that its transaction volume increased by 130 percent in 2018 and that Africa was the primary driver of this growth.
The biggest growth is being seen in West Africa: Nigeria has doubled its number of crypto users and Ghana has tripled the number. Paxful, which has offices in Hong Kong, New York and Manila, says that African users account for 35% of its users.
As many have said before, Africa has a greater need for crypto than other regions. The financial systems across the continent are biased in the favour of ruling elites. Furthermore, it has a substantial population that is unbanked, and even for those with access to financial services, some of the basic functions such as funds transfer are quite costly. According to the World Bank, remittances to Africa are the most expensive in the world. Which is why crypto is now picking up pace as Africans realise that cryptcurrencies are faster, easier, cheaper and more convenient.