Crypto in Africa: 4 reasons digital money thrive on the Dark continent

September 12, 2019

According to recent surveys, South Africa features the highest percentage of internet users owning crypto – over 10.5%. It is more than in Thailand (9.7%), Indonesia (9.3%, Switzerland (7%), US (5.3%) and Japan (4.3%). The top three African countries most enthusiastic about cryptocurrency adoption are SA, Nigeria and Ghana.

Why Africa, normally not associated with technical progress and innovation, is currently outstripping the most advanced and well-equipped countries in the world?

They are several reasons explaining why cryptos are in great demand there.

Low credit card penetration. It’s only natural that crypto thrives where banks fail to perform their functions, or when these institutions are not interested in providing their services to the people. There is a lot of unbanked individuals in Africa, and using a P2P version of digital cash is the only way for them to get access to financial services.

Failed national economies. Many citizens of African countries are seeking a way to stabilize their assets, as their national economies are highly unsteady and feature abnormally high inflation rates. In this situation, decentralized digital coins become a kind of parallel currency. When your national money may turn to zero tomorrow, or be appropriated by the government that issued it, it’s comforting to have a better alternative, that no authority have real control over.

The US dollar could be a good alternative to a volatile national currency, too. But Bitcoin and friends seem a better substitute, as USD usage is more strictly controlled and regulated. Besides, some countries like Nigeria have difficulty with money transfers from abroad – due to numerous internet fraud cases the well-reputed financial giants like PayPal do not operate there. Those who do, charge higher than usual fees for cross-border transfers. Cryptocurrency, with its low transaction fees, has no rivals in this case.

High unemployment rate. The NBS (National Bureau of Statistics) reports that in 2018 the rate of unemployment in Nigeria was over 23%. Many graduates unable to find a domestic job, start working as freelancers for businesses located in other jurisdictions. Considering the money transfer difficulties we mentioned above, it is explicable that the African freelancer community opts for crypto as a convenient, cheap and fast means of cross-border money movement.

Also, many local businesses rely on the same scheme, crypto being a flexible alternative to costly (or simply non-existent) traditional financial services.

High smartphone penetration. In Africa, the majority of people rely on their smartphones for pretty everything, and telecom market analysts predict that by 2020 80 percent of 800 000 people living in the Sub-Saharan part of the continent will be using a mobile device with an active internet subscription. Such high mobile penetration rate accounts for the growing popularity of cryptocurrencies and related apps. People here are tech-savvy enough, and are accustomed to mobile banking that was introduced to them a decade ago, and has gone mainstream by now.


To sum it up, there are enough reasons for Africa to become the world’s cryptocurrency adoption leader. The digital money grows popular where it is needed most – in the states with devastated economies and corrupt governments. 

After all, when you have nothing to lose, the well-known disadvantages of crypto, such as its high volatility and its unclear legal status might be of little importance.

Or even of great use.


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