Africa has registered a remarkable growth in past year with relation to Bitcoin adoption, thanks to the retail users. According to a report by Chainanalysis, taking up of Bitcoin in Africa has skyrocketed to over 1,200% in the past one year making the continent third largest growing Bitcoin economy globally.
Retail investors in Africa utilize Bitcoin on a regular mode for savings, remittances, and peer-to-peer (P2P) trading. Globally P2P trading has been the largest in Africa as citizens often end up facing restrictions from bank to centralized bitcoin on-ramps. The biggest advantage has been that P2P trading for Bitcoin is a ‘permissionless’ phenomenon that has came to benefit of African citizens who can bypass all federal restrictions of remittances and transfer funds across borders.
Artur Schaback, COO and co-founder of P2P exchange Paxful, said that his company has seen a remarkable growth in leading African countries. Growth in the past one year has been about 57% in Nigeria and whooping over 300% in Kenya. At least $48 million were received in Sub Saharan Africa in 2019 in remittances, study by Brookings Institute suggests.
Schaback explains that apart from remittances, African traders can perform international commercial transactions with much ease using Bitcoin. P2P markets help users to pay using Bitcoin for importing goods, a more efficient way than traditional banking. “If you’re working with a partner in China to import goods to sell in Nigeria or Kenya, it can be hard to send enough fiat currency to China to complete your purchases,” said Schaback.
“It’s often easier to just buy bitcoin locally on a P2P exchange and then send it to your partner.” Nigerian government has announced plans to develop ‘e-naira’, Central Bank Digital Currency (CBDC), in response to rising fondness towards Bitcoin. Citizens, however, might keep using superior money Bitcoin, according to Adedeji Owobi, CEO of blockchain consultancy firm Convexity.