The Current State of Bitcoin’s Popularity in Nigeria and South Africa
It is no secret that cryptocurrencies are quickly gaining popularity across the world. In Africa, there are two main countries that have seen a huge surge in the trading and use of cryptocurrencies. Today, Nigeria and South Africa are among the top 20 countries in global cryptocurrency adoption. There are many reasons why this is happening. Let’s look at the current state of Bitcoin’s popularity in Nigeria and South Africa and some of the reasons for a surge in adoption.
How Popular is Bitcoin in Nigeria and South Africa?
According to Triple-A, Nigeria now ranks 8th in crypto ownership by country with over 12 million crypto owners. On the other hand, South Africa is not far behind ranking 13th with just over 6 million crypto owners. Evidently, Africa is now a hotbed for cryptocurrency trading and use. As such, there are now many companies that allow people to buy and sell cryptocurrencies in Africa. Some companies even offer promotions, like a $30 welcome bonus, to give new clients a head start.
Interestingly, the rise in popularity of Bitcoin in these countries is not only in trading and ownership. In Sep 2022, a Coindesk report suggested that Sub-Saharan Africa is now the leading region in crypto retail payments of less than $1,000. There seems to be an increasing need for the use of cryptocurrencies in day-to-day life. While Africa has a plethora of payment applications, cryptocurrencies are seeing a gradual rise in adoption for the convenience and control they offer to consumers.
Even with some restrictions on Cryptocurrencies in Nigeria, Bitcoin’s popularity has not gone down. In 2021, the Central Bank of Nigeria banned all banks from participating in Crypto transactions as it does not recognize cryptocurrencies as legal tenders. This only propped up the peer-to-peer market in Nigeria. In contrast, the FSCA in South Africa recently declared crypto assets as financial products and seeks to regulate them.
Reasons For The Rise In Popularity of Bitcoin In Nigeria and South Africa
Bitcoin and other cryptocurrencies solve a lot of problems associated with traditional payment systems. Currently, almost every African country has a mobile-based payment system operated by a private company. Unfortunately, there is not much harmony between the different payment systems making cross-border transactions a nightmare.
Bitcoin helps solve this problem by allowing consumers to have full control over transactions. People can send funds anywhere in the world at any time. Even with restrictions and regulations, participants can always trade on a peer-to-peer basis whenever they please. The more the government tries to control Bitcoin and other cryptos, the more consumers seek freedom and less control.
However, this can be a double-edged sword. Under regulation can lead to a rise in scam operations. Already there have been high-profile cases of scam operations that have been exposed. Additionally, some crypto projects do not have the best operating policies which leads to collapse and eventual bankruptcy of the projects. Still, consumers adopt Bitcoin alongside other cryptocurrencies while fully aware of the risks involved because, to them, the merits far outweigh the risks. Besides, there are a lot of people that view Bitcoin and other cryptos as an investment opportunity that could earn them profits.
Closing Remarks
As it stands, Bitcoin’s popularity in Nigeria and South Africa is on the rise. Some of the owners of Bitcoin see it as a currency to exchange for goods and services. This has seen a rise in small retail payments and peer-to-peer transactions in Sub-Saharan Africa. Additionally, a lot of people are seeing Bitcoin as an investment opportunity and are trading it for profit. Further, some unbanked could simply be seeing Bitcoin and other cryptocurrencies as an opportunity to receive traditional financial services.