Cryptocurrency was met with enthusiasm by several African countries when it first emerged on the scene and quickly became popular. Since then, crypto adoption has been soaring in certain nations on the continent, particularly due to its accessibility. Bitcoin currently outstrips all other digital currencies in terms of adoption.
However, some African nations have far more crypto owners than others, almost having crypto ownership that is on par with overseas countries.
Countries with the highest rate of crypto adoption in Africa
As of September 2022, a whopping 27% of Nigerians are cryptocurrency owners. This is impressive given that there are tight restrictions on cryptocurrency in the nation, put in place and enforced by the Central Bank of Nigeria.
Why so many Nigerians own cryptocurrency
- Making ends meet: Many youths who are faced with poverty or joblessness – there is also a high rate of unemployment in Nigeria (33% of citizens have no job) – have turned to crypto as a way to earn a living, particularly as crypto has the potential of being easy money.
- The publicity bitcoin gained through a social justice movement: Bitcoin, and thus cryptocurrency, arrived on the public radar and sparked widespread interest when it was used in fundraising by a movement against police brutality, ‘EndSARS’. People realised how easy transacting with cryptocurrency was.
- The weakening of the Naira: Many began adopting cryptocurrency when Nigeria’s local currency, the Naira, first started to decrease in value, and this paired with high inflation rates on savings accounts with Naira currency led many to instead start saving their money in the form of cryptocurrency.
2. South Africa
In South Africa, there are also 4 million people who own cryptocurrency, 10% of the population, according to a report from August. This percentage is also likely to expand greatly in the coming years; South Africa has made more headway in its journey to regulate digital currencies than most other countries, including those outside of Africa, making it easier to use crypto and helping cryptocurrency businesses to take hold.
In a big step towards higher crypto regulation, South Africa’s Financial Sector Conduct Authority (FSCA), which regulates the country’s financial markets, formally declared crypto assets as financial products in a notice last month.
Why South Africa has so many cryptocurrency owners
- Emergence of regulators: Regulators entering the scene – such as the South African Reserve Bank (SARB) which advised banks in the country not to close accounts of crypto exchanges – offers cryptocurrency owners a form of asset protection that does not exist without any regulations. This protection has attracted more to buying crypto knowing they have something of a safety net.
- Good investment: Crypto is viewed as a good investment by 47% of South Africans, possibly because it is a way to gain short-term profit as well as the low inflation rate and liquidity of crypto, which can also make it a good long-term investment.The possibility of being able to quickly build wealth through crypto – and preserve it – may also be alluring to people who are economically disadvantaged or unemployed, and who make up a large part of South Africa’s population. (35% of South Africans are jobless.)
According to stats from a United Nations (UN) report this year, more than 4 million people in Kenya own cryptocurrency. This means over 8.5% of Kenya’s population owns digital currencies.
Why Kenya has so many crypto owners
- Low fees: Cryptocurrency exchanges in the country charge low fees, and the wide adoption of crypto in Kenya has been attributed in part to this fact.
- Fast way of sending money: The success of mobile money services like MPesa is because they are the fastest, easiest, and cheapest way for people to send remittances and international transactions (without extra fees) for unbanked individuals. Cryptocurrency products likewise provide a convenient and inexpensive solution for these things. Traditional remittance services are costly, which is why alternatives have quickly become so popular.
- Speedy method of buying goods for commercial trading – export and import: As with sending money and making local payments, cryptocurrency makes it easier to perform international purchases without the extra international payment fees charged by money transfer providers.
- Internet access: A growing share of Kenya’s population has internet access thanks to mobile phones being so widespread, and an increasing number of citizens have smartphones from which they are able to keep crypto wallets and perform crypto transactions.
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