Connect with us
nairametrics

Cryptocurrency

Why Africans are fast using Bitcoin for payment transfers

In recent times, the use of Bitcoins for payment transfers has fast increased in the continent.

Published

on

Africa has one of the fastest-growing crypto spaces in the world, with Africans sending about $8.0 billion worth of crypto, while receiving about $8.1 billion worth of crypto in 2019.

The increased usage by many young, educated Africans is a result of the economic instability and high bureaucratic processes by African banks for transfers. Bitcoin offers low-fee remittances and an alternative way to preserve and grow wealth.

READ: Why Nigeria’s low tax collection rate can’t be fixed just yet

Bitcoin is attracting many African millennials, as a report coming from the World Bank revealed that the global average cost of sending $200 remains as high as 6.8% in the first quarter of 2020, only slightly below the previous year. Sub-Saharan Africa continues to have the highest average cost at about 9 percent, yet intra-regional migrants in Sub-Saharan Africa comprises over two-thirds of all international migration from the region.

These high transactional costs have been countered with the usage of Bitcoin, where transaction cost can be as little as $5 to move over $10,000 worth of Bitcoins.

GTBank 728 x 90

READ: Report shows Nigerians are spending less on cooking gas

In an explanatory note, Adebayo Juwon, FTX Country Manager, spoke exclusively to Nairametrics on why Bitcoin is fast gaining traction among Africans. He said:

“Bitcoin serves as a store of value, speculative asset, and means of payment, among other things. Bitcoin is personally owned by holders, which no government has authority over. Africans are getting the idea of Bitcoin, and using it more for transactions across borders with no third party involved, no long processing period, and low fees.

GTBank 728 x 90

READ: CBN grants Greenwich Trust Limited operational license for merchant banking

“Using Bitcoin also gives direct exposure to USD, EUR, GBP etc. without stepping into the banking hall. This means bitcoin users in Africa can convert their crypto assets to a more stable currency. This makes local and international transfers seamless for bitcoin users from their mobile devices.”

Africans are using Bitcoin to avoid expensive and heavily bureaucratic money transfer systems currently available. Many of them now rely on remittances for their daily activities, so any way of making the process more effective and cheaper would be of great benefit to them, and this is where Bitcoin comes in.

READ: Has the President erred in stopping CBN from funding food imports?

Ray Youssef, CEO and founder of crypto-exchange Paxful, emphasized the role that Bitcoin remittances play for African users on Paxful. He said:

Jaiz bank ads

“Some of our users in Africa are even building their own remittance businesses on top of Paxful. One man I spoke to who lives in South Africa but is originally from Nigeria saw how hard it was to send money back home, and started a business where he would take cash from other Nigerian expatriates, convert it into Bitcoin, send it to someone in Nigeria via Paxful, and have that person convert it into naira and deliver it to the person’s family.’’

Fidelity ads

READ: New crypto gains 1,633% in four days, catches Ethereum creator’s eyes

Youssef cited some examples of how some Paxful users skipped bank transfers. He stated:

“In one instance, a user ran a business importing video games from China to sell in Nigeria. His bank wouldn’t let him wire money to China, so historically he had to get U.S. dollars on the black market and somehow get it to China, usually via Hong Kong. But with cryptocurrency, he can sell bitcoin to receive CNY (Chinese Yen) in any major Chinese digital wallet and send it directly to his counterparty in China.”

READ: Amaechi pleads with NASS to halt questioning of loan agreement with China

Moreso, Africans use Bitcoin as preservation for wealth and to hedge against inflation. For instance, Nigeria having an inflation rate of 12.58% shows that the value of the naira depreciates by that much every year, thereby eroding the purchasing power of many Nigerians.

Olumide Adesina is a France-born Nigerian. He is a Certified Investment Trader, with more than 15 years of working expertise in Investment Trading and Financial Market Analysis. Member of the Chartered Financial Analyst Society. You can follow Olumide on Twitter @tokunboadesina or email [email protected]

Click to comment

Leave a Reply

Your email address will not be published.

This site uses Akismet to reduce spam. Learn how your comment data is processed.

Cryptocurrency

6 Cryptos rich investors are buying

$ETH, $LINK, $REN, $ELF, $KNC, & $ZRX are among cryptos recently hitting one-year highs.

Published

on

A new survey has shown that though many crypto exchanges affirm their commitment to warding off criminals who aim to launder money and fund terrorist activities, Crypto: Investors flocking in large numbers into altcoins

High net worth investors are quietly putting capital into some cryptos amid the recent bullish happening at the flagship crypto market.

Unsurprisingly, all the cryptos seen by Nairametrics recording high cash inflows are based and built on Ethereum, and the amount of each held by the high net worth investors addresses has hit one-year highs in the previous week, according to a crypto analytics firm – Santiment.

READ: Zoom’s market valuation hits $50 billion mark, thanks to COVID-19

As investors give the world flagship crypto the much-needed attention, Bitcoin’s market price has been ranging between $12.7k and $13.3k, as crypto whales of many respective $ETH-based #altcoins have added to their non-exchange bags. $ETH, $LINK, $REN, $ELF, $KNC, & $ZRX are among those recently hitting one-year highs.

READ: Bitcoin Whale transfers $1.1 billion worth of crypto for $3.58

GTBank 728 x 90

What you should know

All seems to be going well for these crypto’s derivative Ethereum. At the time of writing this publication, Ethereum traded at $387.51 with a daily trading volume of $10,620,097,122.

GTBank 728 x 90

READ: Ethereum whale transfers 169,296 Cryptos

  • ETH price is up 0.2% in the last 24 hours. It has a circulating supply of 110 million coins and a max supply of ∞ coins.
  • There are good news and bad news for #Ethereum’s quest to again surpass the $420 price barrier.
  • The good news is that miners aren’t selling, and there is a big increase in new $ETH addresses being created, and pre-existing addresses have shown increased inactivity.
  • The bad news is that social sentiment is bordering on the euphoric territory, and daily active deposits have jumped in a big way.

Continue Reading

Cryptocurrency

Why Nigeria is Africa’s biggest Crypto market

Cryptos are fast becoming more popular for payment transactions around the world and Nigeria has emerged Africa’s biggest market.

Published

on

Why Nigeria is Africa’s biggest Crypto market

Nigerians are fasting adopting the world’s most popular crypto – Bitcoin, as their mainstream for payments and wealth preservation. Thus, setting the pace for other African countries – as it leads the whole African continent combined in the use of Bitcoin via transactions turnover.

Then, it becomes unsurprising to see leading crypto brands like Binance, Paxful, FTX, Crypto.com, printing their labels in Nigeria, as it is apparently one of the fastest-growing crypto markets in the ever-changing world.

READ: Coalition of African lawmakers seeks debt relief for African states

According to a new study seen by Nairametrics, Nigeria has seen the largest influx of activity in peer to peer lending in the month of October.

What you should know

GTBank 728 x 90

Data obtained from usefultulips, a BTC analytic data provider showed Nigeria leads Africa’s peer to peer lending in the month of October 2020, as it posted a monthly P2P volumes of between $32.5 million, followed by South Africa and Kenya posting about $9million and $7.4 million respectively.

READ: #EndSARS: Access Bank announces N50 billion interest-free facility for businesses

What they are saying

GTBank 728 x 90

Ekene Ojieh, Head Of Public Relations, Buffalo Chase, a fast-growing crypto analytic firm, attributed the upward trend in the adoption of cryptos – most especially Bitcoin, to Nigeria’s demographic structure.

“Nigeria ranks 8th position in the largest country with crypto adoption. The reasons for this fact are not far-fetched.

“The Nigerian youth has about 32% of the entire population of about 200 million people.

READ: COVID-19: IMF Chief predicts $345 billion financing gap in African countries 

“It’s easy for a young country like Nigeria to adopt the use of bitcoin because a large percentage of its population falls within the age range that is tech-savvy. Although, that’s not the only reason why many Nigerian youths adopt bitcoin.

Jaiz bank ads

“Nigerian youths prefer to secure their assets in bitcoin or stablecoins because naira like every other fiat currency is susceptible to inflation.

Fidelity ads

“The borderless feature of bitcoin makes payment effortless and transaction fee outrageously low.

READ: CBN reveals framework for the N75 billion Youth Investment Fund

“In the recent protest in Nigeria, we saw the sharp switch to bitcoin after the movement’s bank account was frozen making up to about 44% of the entire donation.

“Bitcoin gained an impressive 13.7% over week 43 – as per Glassnode. Bitcoin is currently traded at a $13,000 region. With the accessibility of bitcoin, we see more Nigerian youths adopting the use of bitcoin.”

READ: Rich Bitcoin investor moved $175 million worth of BTC for just $0.84

It’s also critical to note that a significant number of Nigerian youths, amid #EndSARS protest that had triggered police reforms, got help from Bitcoin, on the principle that its payments were secured and had no central authority, which could breach payment. The funds were consequently used in aiding and providing medical and legal bills for some youths who had peacefully set out for such cause and got arrested in that period.

Another thing that surely stood out in the just concluded #EndSARS protest and got the rare limelight in the crypto-verse, is a Nigerian female rights group better known as the Feminist Coalition, a non-governmental organization originally created to push for gender equality in Nigeria, used the power of crypto technology in disbursing funds for injured protesters, food, water, first aid supplies – that the co-founder of Twitter, Jack Dorsey had to lend his support.

Coronation ads

READ: Togo, Niger, Benin remit N2.04 billion to Nigeria for power supply

READ: Tether opens up 300,000,000 USDT

app

Dorsey tweeted, “Donate via Bitcoin to help #EndSARS,” while also retweeting a tweet by the Feminist Coalition informing Nigerians of how to support the fast-changing female right group.

 

Bottom line

Nigerian millennials are fast adapting to the most ever-changing financial asset in the modern era and leading brands are also taking advantage of such prevailing macro.

Continue Reading

Cryptocurrency

Most profitable asset in a decade, Bitcoin up over 26,600,000%

Bitcoin, from $0.06 in September 2010 exploded to its current price of around $13,000, representing a surge of over 26,600,000%.

Published

on

cryptocurrency, Bitcoin on steroids, rages higher

The odds are now playing strongly in favor of the world’s most popular crypto – Bitcoin.

Data retrieved from a well-known crypto custodian firm Blockchain showed how Bitcoin from $0.06 in September 2010 exploded to its current price of around $13,000 – representing a surge of over 26,600,000% in a span of 10 years.

READ: Pigs on a rampage as Bitcoin prices drop over 10%

READ: Bulls on rampage, Ethereum wallets now record high

Meanwhile, the same couldn’t be said about its closest performing rivals, which included the Yellow metal and the S&P 500, which climbed 103% and 233% respectively over the same stretch.

GTBank 728 x 90

Why this matters

The flagship crypto seems to run hot on many prevailing macros, not forgetting that the general economic law states that when demand is high and supply is limited, prices of such products will usually go up.

READ: Chainlink breaks into top 10 most valuable cryptocurrency in the world

  • Bitcoin has established a robust support level at $13,000,
  • It should also be noted in the past few years, that Bitcoin holders are refusing to sell and instead use it for wealth preservation.
  • Also, another strong sign giving crypto traders bullish bias include Bitcoin’s  Active Supply 3y-5y (1d MA) just reaching a 23-month high of 1,840,755.050 BTC, as seen from Glassnode – a popular analytic firm

A previous 23-month high of 1,840,745.362 BTC was observed earlier today.

GTBank 728 x 90

READ: Apple claims GEEP Canada stole over 100,000 of its devices

READ: Fate of $2.3 billion worth of Bitcoins in Limbo

What this means

Nairametrics earlier broke the news on how the world’s flagship crypto continues to gain traction at the speed of light. The renowned financial data media company, Bloomberg Intelligence, gave critical insights on why bitcoin, in just about five years’ time, could hit a valuation of $100,000.

READ: There are now 13,173 BTC millionaires around the world

READ: China’s economy bounces back from COVID-19 slump, with a growth of 4.9% in Q3 2020

Jaiz bank ads

“Bitcoin’s foundation is firming for further price advances if its history is a guide. Since initially reaching $10,000 in 2017, the benchmark crypto corrected about 70% and remains in an extended period of consolidation around that level,” the report said.

Fidelity ads

Continue Reading
Advertisement
Advertisement
Advertisement
ikeja electric
Advertisement
Advertisement
Patricia
act markets
Advertisement
FCMB ads
Advertisement
IZIKJON
Advertisement
Fidelity ads
act markets
Advertisement
first bank
Advertisement
bitad
Advertisement
Stallion ads
Advertisement
financial calculator
Advertisement
deals book
Advertisement
app
Advertisement