Cryptocurrencies are currently disrupting all major financial instruments of the world. Over the last few months, many digital coins have made steady gains, and just last week we saw the price of a single Bitcoin rise to $11,500 as investment continues to gain momentum.
Blockchain was introduced to Africa 5 years ago, and was initially met with skepticism. A few early adopters made substantial investments at the time, and they are all a few digits richer today. The initial laxity towards Bitcoin then was due to inadequate information concerning the concept – A lot of people just didn’t understand it. No thanks to the amount of thought that needed to go into figuring out how transactions are confirmed, how the ‘mining’ was actually done and the Blockchain structure in general. Most Digital coin companies did not break it down in simple terms.
Cryptocurrency has come a long way since then. Many companies have taken up the challenge of bringing clarity and simplicity to an erstwhile puzzling concept, and there is now sufficient information for a new investor to make an informed buying or selling decision.
Any Digital coin company seeking to break into the African financial space, however will need to brace itself for a few challenges on the path to establishing market dominance and driving increased adoption among citizens of the continent. Some key issues must be put into consideration.
Recognition by governments of Africa at this time is fledgling. For example, the Central Bank of Nigeria does not yet recognize cryptocurrency as a legal tender. South Africa and Kenya are seeing more widespread adoption than most, and more recently, Zimbabwe is turning to digital currency to hedge against hyperinflation in the price of commodities.
To surmount these challenges, the company must partner with the respective governments of countries in which they operate at both apex and local government levels. The company will need to prove to the government beyond reasonable doubt that switching to cryptocurrencies will boost the economy while considerably increasing bottom-lines.
Another key issue will be how the system can be practicalized to benefit the common man. If implementation is successfully carried out on a small pilot scale, it would boost government confidence and commitment to restructuring financial systems for a sustainable future.
A major impediment to adoption of cryptocurrency in Africa is lack of simple, practical information regarding Blockchain technology.
On the global scene, less than 10% of people have sufficient understanding of the concept. A good number of users may have bought into the idea to cash out huge profits, but equally important is understanding how that fits into the big picture.
It is not the case that there is a dearth of information about Blockchain technologies, but rather that there is simply not enough easy to understand information out there. Cryptocurrency needs to be simplified for everyone.
Awareness about cryptocurrency and blockchain technology needs to be widely and adequately publicized to intimate users and potential investors about the product. Africa is a largely under-served market with challenging, yet great potential to implement crypto systems that are easy to understand, functional and user-centric. Simply put, people need to know WHY they need to switch to digital currency.
Small, Medium and Large Scale Integration
After successful introduction and adoption begins to gain traction, the company will need to come up with smart and effective methods to implement the technology at various points of the economy.
From the local farmer who wants to secure his earnings with a more inflation-resistant form of currency, to the budding entrepreneur leveraging digital coins for her business, to the top-level executive looking to convert part of his financial portfolio to part of a Blockchain sequence, the company will need to offer something for everyone.
Having an advanced, scalable blockchain technology that can be morphed into many different applications for multiple purposes cannot be over-emphasized. Digital coin leaders planning to do business in Africa must acquire a formidable team of miners, engineers and powerful computing hardware to take on the most daunting challenges and offer value that will be tangible for everyone.