Cryptocurrency may not have enjoyed a level of popularity anywhere else in the world as it does in Africa.
It has been banned in 19 countries around the world, with some in Africa having outlawed it for various reasons. These include its unregulated nature and the uncertainty that people around it have, such as those in Ghana.
However, numerous countries across the continent have embraced virtual currency and are looking to try and capitalize on what it can provide. Countries like Nigeria, South Africa, Kenya, and those in Sub-Saharan Africa are among those that have really taken a favorable outlook on it.
Why are some Africans embracing crypto?
Inflation has always been a huge issue for many African countries. It is not uncommon to hear stories of inflation causing economic catastrophes and depressions in certain countries, with Zimbabwe in 2007 being one of the most extreme cases to have been experienced.
However, inflation is still rife in many countries across the continent, with Ghana experiencing a rate of almost 30% in 2022. Nigeria has also experienced its fair share of inflation issues, with its level reaching 29.9% in January 2024, and it is only forecasted to grow further.
With inflation being associated to the fiat currency, many have embraced crypto due to its unregulated nature. Its decentralized features mean it is not linked to a currency, thus allowing it to have a certain level of value that is not dependent on the home currency. Of course, volatility can still be experienced, but many are betting on it to remain better than what their nation’s currency is worth. In Nigeria alone, around 22 million people are thought to own and use crypto.
Some Africans have adopted and embraced virtual currency because it has allowed them to engage in activities that they might not have been able to or may be frowned upon by banks. For instance, with gambling still outlawed by some, many use the sites that provide crypto slots to play as they can do so freely. In doing so, they can keep themselves safe and hide their identities.
Most, though, across Africa are using crypto as their primary currency due to the unbanked situation that many face. According to figures, 2021 saw over half of the continent’s population (57%) be unbanked. This meant they did not have anywhere to store their money safely or have access to methods that required digital payments. Cryptocurrency allows Africans who face trouble being banked to make purchases online, as they do not need to hold a bank account to do so.
Will Africa continue to embrace cryptocurrency?
It is clear to see that Africa has benefited from the introduction of cryptocurrency and that it has had a significant impact on the continent for many. Of course, there are still some concerns regarding its status in many countries, but with the issues fiat currencies are providing in terms of inflation and the majority of the population being unbanked, it is no surprise so many have turned to it.
It would not be a surprise if virtual currency were to be embraced even further in the coming years, as it continues to fill the gap and provide solutions that many governments do not seem able to provide their people currently.
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