Bitcoin (BTC) is booming in Africa as small business owners and migrant workers turn to the flagship cryptocurrency for speed and convenience in sending payments and remittances.
Data from blockchain research firm Chainalysis reveals that the monthly BTC transfers to and from Africa worth less than $10,000 amounted to $316 million in June, marking an increase of more than 55% in just one year. The number of monthly cryptocurrency transfers also jumped by nearly half.
The $10,000 threshold represents transactions made by small businesses and individuals rather than traders.
Citing information gathered from 20 Bitcoin users based in Africa and five cryptocurrency exchanges, Reuters reports that the cryptocurrency boom in the region is driven by young and tech-savvy users who are quickly adapting to Bitcoin in a complex bureaucratic framework that restricts money transfers.
Speaking to Reuters, Frankline Kihiu, a crypto broker in Nairobi, Kenya says
“people are very adoptive of any technology that will make their life easier.”
Kihiu identifies a restrictive environment as one of the reasons for adopting BTC.
“In most African countries, there are lots of government restrictions that Bitcoin takes away.”
The difficulty in getting the US dollars also prompts businesses to turn to Bitcoin. The Nigerian Naira has seen significant devaluation because of low crude prices and the COVID-19 pandemic. As a result of weakening local currencies, importers have to pay more to buy US dollars, so they seek ways to purchase goods from overseas without having to use the de facto currency for international trade.
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