Is cryptocurrency a thing for Africa?

Bitcoin occupies an enviable place in the field of cryptocurrency. Since its introduction on Jan. 3, 2009, bitcoin has weathered several storms including speculations, uncertainty and skepticism. Initially, even large corporations that have expert financial experts were reluctant to embrace it. But over time, people are slowly becoming more aware as new and clear information about cryptocurrency becomes more available.

Today, countries like El Salvador has accepted Bitcoin as one of its currency . Similarly, many businesses including Wikipedia, Paypal, Starbucks, AT&T, Overstock, Twitch and Amazon accept cryptocurrency for completing transactions.

Generally, Bitcoin has been accepted highly in the other continents across the globe. However, in Africa, most of the nations have not considered it as a decentralized asset utilized in storing and transferring value. Let’s try to identify some of the daunting challenges that cryptocurrency is facing in the ambitious plan to transition from paper and metal money to a fully virtual currency. Here are some of the reasons why cryptocurrency uptake in Africa has been rather slow.

Inadequate cryptocurrency education

In all the African nations, no framework has been established in offering cryptocurrency education. Most people just use the social media platforms in learning or getting more information. Some of the social media that are mainly utilized include Instagram, YouTube, TikTok, Facebook, and Twitter.

Apart from social media, they do dig for information from blog articles and books. Moreover, the main information that Africans do need includes private companies, individuals, and cryptocurrency exchanges. Therefore, in reaching more clients, it is important to provide more insights regarding cryptocurrency as well as the main players.

Education is the most important thing before commencing to engage in the world of cryptocurrency. People can not buy something that they do not understand the way it works. Therefore, the major cryptocurrencies should work towards providing more information, the way it works, and how one can trade it.

The issue of lack of education has made many firms to come in the form of being players in the cryptocurrency market. Africans have been conned billions of dollars in the name of making more profit. The companies that scam people have made most of the Africans to lose trust in cryptocurrency as well as its trade.

Lack of Regulation and Trust

The crypto currency world is fast changing. Unfortunately, in some of the African nations, there is no proper regulation. It means that some of the firms may be put out of business yet it is another body that is affecting their operations. Therefore, it is important to have regulatory frameworks in being successful in the adoption of cryptocurrency.

Cryptocurrency world is fast changing. Unfortunately, one of the risks affecting the cryptocurrency market is inadequate regulation in almost all the African nations. Inadequate regulation means that a firm can be put out of business just overnight.

In business regulation is important. If a business is not regulated, then it means that every company can just do what they want without caring whether it is the right or wrong thing. Regulations must be there for the players to be safe. Even in the banks, we have to follow rules including transaction limits, the number of transactions in a day, and the minimum capital.

Apart from regulation trust is needed for Africans to fully adopt cryptocurrencies such as bitcoin. Most of the firms have written letters in quest for regulation but it has not been successful. It is the regulation that will make people to have trust in trading in cryptocurrencies. The reason is because it will ensure that there is consistency.

Furthermore, people do not trust cryptocurrency because it does not have value. No real value is tied to any kind of cryptocurrency. Therefore, they believe that in the future, it will be worth nothing or little.

The other reason why people do not have trust in bitcoin is that the government does not back it up. Unfortunately, of the features that define any cryptocurrency is decentralized asset used in securely storing and transferring value meaning that the government does not have to oversee it. Besides, some individuals only feel comfortable and safe with the assets overseen by the government.

Most of the Main Regulatory Bodies are Banning Digital Currencies

The regulation of crypto in most of the African nations is somehow unfavorable. The frontrunner nations such as Mauritius and South Africa have shown the way progressive enhances enormous benefits. Unfortunately, to get the benefits, it is important to consider the kind of regulatory approach that will impress the private sector.

Even though most of the emerging markets governments watch the way the United States as well as the nations that adopted cryptocurrency, they can bring solutions. They can do this by availing sandbox solutions that come from the financial service providers. Thus, such things affect the adoption of cryptocurrency in Africa.

The money transfer companies including OFX, World Remit, and Western Union offer creative way of finishing the know your customers checks. It means that one does not have to necessarily provide tax returns and fixed address.

Inadequate Market for Cryptocurrency

In Africa, unlike the other continents, there is no big market for Cryptocurrency. However, it has really grown currency as compared to the past years. May be Africans are now realizing that adopting it is the way to go. Some of the African nations that have adopted the utilization of cryptocurrency include Ghana, Kenya, Zimbabwe, Nigeria, and South Africa.

There are over 50 nations in Africa. Unfortunately, only five of them have adopted the usage. In addition, in a nation like Nigeria where the residents adopted cryptocurrency, in 2017, things changed and the government banned its usage. According to the government, Bitcoin investments did not have a cover in Nigeria. The government even went further to warn all the financial institutions and banks in the nation from transacting, trading, holding, and using virtual currency.

The African firms that transact through cryptocurrency technology

Bankymoon

Bankymoon is a consulting firm as well as software that has proficiency in the Blockchain technology. Moreover, it is located in South Africa. The company develops bespoke solutions for its consumers who need Bitcoins as well as the other kinds of cryptocurrencies. Also, it has launched smart meter technology blockchain as a solution for consumer banks with no formal banking utilities and the electrical utilities which struggle to collect revenues.

Leaf

Lead is a company located in Rwanda. It develops platform for mobile applications in facilitating conversion of currencies to virtual currency. The technology used is blockchain technology and it does not have to access the African banks.

Centbee

Centbee is a South African Bitcoin. It has been growing over the years as it has global ambitions. Moreover, the firm is highly specialized in merchant payments, cryptocurrency related products, and cross border remittances. The enterprise also gives users the chance of making transactions using Bitcoin SV.

Akoin

Akoin works towards enhancing financial stability in Africa as it offers secure monetary system and boosting economies. It was launched in 2018 by Akon, the Senegalese singer and it gives consumers the chance of saving, spending, and buying Akoin directly through the mobile application.