Across Africa, the continent’s tech savvy youth are turning to bitcoin. Faced with crashing currencies and high unemployment, many see trading cryptocurrencies as a promising new way to make a living.
Adoption in the continent is occurring at breakneck speed, especially in Central Africa’s economic hubs, such as Lagos in Nigeria, Nairobi in Kenya, and Kampala in Uganda. Nigeria’s demand growth, for instance, is second only to China.
With the surge of popularity, many are turning to stars in the scene to learn how to trade. Uganda’s Richard M. Bagorogo hosts classes and events across the country.
“What I have earned in one-and-a-half years from bitcoin is more than I earned in 10 years as a teacher,” he explains.
Martin Serugga, another of Uganda’s bitcoin personalities notes:
“Since 2008, I have held classes in forex trading. Bitcoin has been added as a tradable financial instrument on many forex trading platforms. That is why we added it to our classes.”
Others are using cryptocurrencies as a tool to carry out international business dealings. Moses Semulya, a doctor in Kampala highlights the difficulty of doing business in Uganda,
“I used to want to buy medical equipment online but it was becoming hard. Online Transaction is very expensive in Uganda with all the fees. Bitcoin is changing that, making things easier and faster.”
Globally traded and free from fees, cryptocurrencies bring new economic promise to the continent, and Africa’s tech startups are looking to capitalize.
Exchanges, remittance solutions, and even peer-to-peer energy marketplaces have sprouted up, but some of the most successful and useful crypto businesses are those looking to tackle one of biggest financial challenges: banking the unbanked.
Marcus Swanepoel, CEO and co-founder of Luno, who hopes the platform will soon reach 1 billion users explains,
“We realized the banks were going to take too long to embrace the technology, and they were getting confused about what the technology can do.”
Avesta is another company looking to bring new payment solutions to Africa. Having just finished their token sale, 2018 promises to be busy for the company, with hopes to launch a debit card by the end of the year.
“We have created a fast, secure and easy-to-use cryptocurrency with enhanced privacy,” Aydin, CEO of Avesta, explains.
With mobile phone penetration on the rise, and the number of unbanked so high, Africa is ripe with opportunity for early-moving startups offering workable solutions to these payment challenges.
Adoption is not without its challenges, however. Due to a number of scams in the space, such as the MMM Russian Ponzi Scheme, promising users a massive 30 percent gain on their investments, many of the continent’s state-governments are still skeptical of cryptocurrencies. Additionally, the scarcity of energy, and especially internet access will present difficult challenges for ambitious blockchain startups to overcome.
“Bitcoin has the potential to make an impact in Africa under certain circumstances: adoption of the masses which requires education and accessibility through feature phones as well as a friendly regulatory environment,” Falk Benke of Ghana startup Bean says.
There are extremely promising solutions in the works, however. Between Elon Musk’s idea to create a web of micro-satellites to bring internet access to those who may otherwise not have access to infrastructure, and Blockstream Inc’s idea to do the same with access to bitcoin’s blockchain, things are looking up for those looking to get connected.