While the world and western nations struggle for a share of the early spoils and benefits of adopting cryptocurrency and blockchain technology, from filing patents, trademarks, new innovations and integration around the industry. Africa (Nigeria) has been indifferent for most part with little or no moves made in this regard by African-owned companies and governments.
Over time, this seems to be a recurring trend, where Africa takes a self-given back seat while the westerners make the major moves and dominate the industry. As in this case of cryptocurrency and blockchain technology, it looks like this trend will continue.
On a plus side, statistics show that Africa notably Nigeria and South Africa top a global list of cryptocurrency (bitcoin) trading numbers; basically in the Buy/Sell niche. These numbers are for quite obvious reasons: profits and a need to stay afloat the failing economies and currencies.
That said, there is an absence of the innovative mindset to develop or launch products in this industry, educate or explore broader applications of these emerging financial revolutions; other than to make money and leave.
Arguments are raised with particular emphasis on the myth around cryptocurrency in Africa (Nigeria) due to a lack of proper education and a fear of losing capital. This however is a global problem, but of course back home it is a major factor; one which will take some time to clarify; except of course Africa’s millennial population get in as they always do with tech and digital trends for entertainment.
Probable Reasons for this Lag
- High poverty rate
- No vendors or active markets for crypto-retail goods
- Internet access and Smartphone utility: huge luxuries in this part of the world, considering online access and gadgets for cryptocurrency education and participation.
- Focus on instant gains: The MMM mentality.
- Fear and insecurity: Many believe in the regular bank insurance for fiat over a possible loss of funds in cryptocurrency, in cases of no backup.
- Litany of ponzi schemes: Scam coins and rippers have not helped this course either and the victims also failing to do due diligence from research to understanding market basics.
- Most companies and governments await the western nation’s verdict before taking a dive as always.
Areas to invest in Crypto and Blockchain Technology for Africa
For Africa to set its sails in this sector here are a few starting points:
- Proper education and awareness: This would require a re-evaluation of the myths and other false notions about cryptocurrency, as well as an insight to the enormous utility of the blockchain industry.
- Crypto and Blockchain Professionals: Western counterparts have started offering scholarship to students for courses in cryptocurrency and blockchain technology. With the industry needing professionals in blockchain engineering, blockchain development and more, the demand is sky rocketing and early studies are an advantage considering the impressive salaries. We can recruit or export these talents to the wider world.
- Government: With the current focus on oil and agriculture as major earners, there are profitable use cases for blockchain technology in these sectors. Use cases for blockchain technology will ensure much needed transparency and efficient service across all sectors considering the decay and corruption of most systems. Applications in health, energy, electoral processes and finance remain priority.
- Crypto for Goods and Services: A real grey area. Concerns about cryptocurrency volatility and possible tax implications have been raised but merchants and retail companies in Africa are yet to experiment this option. The use of cryptocurrency for payment of goods and services offers advantages from instant payments, ease of use, cheap fees and fewer cases of charge backs.
- Ease of Use Products: According to some interested individuals, a major challenge is the difficulty in understanding crypto. From confusing long wallet addresses to complex online KYC processes, it becomes an uphill task.
For example: To solve this, innovations can be made to assign more understandable or shorter addresses; could be 10 digit numbers with the long addresses encrypted in them. Easier KYC processes by crypto companies in Africa and insurance in cases of custodian wallets will most likely boost confidence and adoption.
Also, SMS based or USSD code crypto transactions could be developed, hence ditching the need for internet access.
Contrary to speculations, Africans (Nigerians) are very interested in Bitcoin and cryptocurrency. Google search trends show clear indications of interest on How to buy? Where to buy? How to invest?
Nigeria, South Africa, Kenya and Ghana lead these search numbers but sadly, these numbers have not translated into widespread adoption of cryptocurrency by users and businesses in Africa; the continent still lags in everyday BTC use.
Mobile money service providers currently amount for majority of transactions and are raking profits in huge numbers; with 50% of mobile money companies present in “money making” Africa.
In all, Africa has the growth potential considering the interest rate in cryptocurrency and blockchain technology. The benefits sure outweigh the risks and it will be interesting to see which African country becomes a forerunner in cryptocurrency use and blockchain technology adoption.
Share your thoughts in the comments.