Cryptocurrency adoption in Africa is on the march, despite socio-economic factors and headwinds. A positive report from cryptocurrency exchange KuCoin shows that cryptocurrency transactions increased by as much as 2,670% in 2021.
An astonishing growth trend, the strong influx is related to the low values that have been observed during the previous periods. The number of crypto transactions in Africa constitutes about 2.8% of global volumes.
Johnny Lyu, CEO of KuCoin, told Cointelegraph that “adoption of digital assets in Africa will continue to grow exponentially,” adding that “African countries have the highest cryptocurrency adoption rate in the world, surpassing even the largest regions such as the United States, Europe, and Asia.”
Nourou the founder of Bitcoin Senegal, is convinced that thousand percent growth rates for Bitcoin (BTC) adoption “will continue for years to come.”
“Look at the way cars, mobile phones and consumer electronics took off on the continent. Africa is a continent where lightning-fast progression and adoption is commonplace.”
In particular, the report cites that “Over 88.5% of cryptocurrency transactions made by Africans are cross-border transfers.” The low commissions mean that “users pay less than 0.01% of the total cryptocurrency transaction amount.”
Thanks to high levels of inflation and the growing penetration of smartphones – which allow anyone to become their own bank – Africa also has a young, digitally native population that is used to digital currencies. Africa is a solid testing ground for the problems that cryptocurrencies are trying to solve.
Lyu cautioned against the staggering levels of growth:
“That pace of growth may depend as much on local policymakers as it does on the stances of various officials on cryptocurrencies. Still, I think a promising future for digital money in Africa is inevitable.”
In Central and West Africa, for example, the adoption of BTC is growing in a context of distrust and discomfort with the local currency, the CFA. Cointelegraph has previously analyzed the state of cryptocurrency adoption in Africa, noting that “the economic opportunities presented by the region are immense.
For Lyu, Africa is in an interesting position given that the combination of “rising inflation, high unemployment rates, poor access to banking services, and huge international payment fees,” creates an environment conducive to the adoption of cryptocurrencies. Definitely:
“The financial problems the region is experiencing are forcing people to look for new tools and technologies that can give them some of the economic freedom they currently lack.”
However, in the long term, Africa harbors a host of advantages, “which cannot but contribute to the widespread use of digital assets among locals.” The average age in Africa is very low – only 19 years – and more than 40% of the population is urban.
“Another positive phenomenon is the growing technological awareness of the local population, with many young people exploring programming technologies and the Internet.”
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