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Bitcoin (BTC) and crypto adoption in Africa has increased by a whopping 1200% in the past year

The adoption of cryptocurrencies such as bitcoin (BTC) is increasing at a rapid pace in Africa. The total transaction volume in the continent has grown by no less than 1200% in the past year. Blockchain research company Chainalysis reports this on September 14:

Africa currently has the smallest crypto economy of all regions with a transaction volume of $105.6 billion between July 2020 and June 2021. Despite this, it is currently the third fastest growing crypto economy in the world and one of the most exciting, says Chainalysis.

Africa also has several countries that are in the top 20 in Chainalysis’s global crypto adoption index. They are as follows: Kenya, Nigeria, Togo, Ghana, South Africa and Tanzania.

Especially so-called peer to peer (P2P) trading platforms are very popular in Africa. African traders use these platforms not only as a stepping stone to crypto, but also for international transfers. P2P platforms account for 1.2% of the total African crypto transaction volume and 2.6% for bitcoin alone.

One reason P2P platforms are so popular is because countries like Kenya and Nigeria have made it difficult for users to transfer funds from their bank accounts to cryptocurrency exchanges. They have done this, for example, through new legislation. P2P platforms are less troubled by these kinds of laws, as these platforms do not hold crypto for customers and most of the trade is between users.

According to Adedeji Owonibi, CEO of Convexity, a lot of African P2P crypto trading also takes place via informal chat rooms and messaging apps such as Whatsapp and Instagram. Chainalysis reports that it has no insight into these numbers, so the P2P activity in the region may be much higher than the company estimates.

Cross-border transfers also make up a larger share of the African crypto market than any other region, with 96% of the total transaction volume versus 78% for all regions combined. One of the reasons for this is that some countries, like Nigeria, have a limit of $500 that can be sent out of the country at the same time. As a result, many Africans are turning to crypto. Finally, Chainalysis reports that many Africans are turning to crypto to protect their piggy bank from the poor economic conditions.

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