Binance, often the top crypto exchange in the world with daily trading volume regularly exceeding USD 1 billion per day, says it is fully committed to Africa and will be investing heavily in crypto infrastructure across a continent struggling with an inflation crisis.
This declaration comes in a post from Benjamin Rameau, the Director of Binance Labs. He gives ten reasons why investing in African crypto infrastructure is a good idea, one of which is out of control fiat inflation across Africa. Out of the 20 countries with the highest fiat inflation according to the CIA World Factbook, 13 of them are in Africa. South Sudan has the worst inflation rate in Africa, over 100% per year, with Congo, Libya, Angola, Sudan, and Suriname having yearly fiat inflation in excess of 20%. Burundi, Mozambique, Sierra Leone, Nigeria, Egypt, Malawi, Liberia, and Ghana, have yearly fiat inflation rates in excess of 10%.
This means a large swath of Africa is dealing with crippling inflation that is decimating life savings and damaging the economy. This makes the continent ripe to adopt crypto since Bitcoin’s supply is fixed, unlike fiat currencies which are printed at will by central banks. This means Bitcoin will hold its value long term, and it will allow Africans to have savings.
Additionally, a large fraction of Africans don’t have banks or access to the financial system. For example, in Sub-Saharan Africa, only 43% of those 15 or older have banks, versus 69% in the rest of the world. Cryptocurrency can provide the financial infrastructure that Africans desperately need but don’t have access to.
Further, cryptocurrencies are decentralized and easy to use across borders, unlike the current situation in Africa where there are 55 different countries, making cross-border financial transactions slow and confusing. Bitcoin and cryptocurrency can drastically increase the liquidity and speed of African finance.
In general, there is also a tremendous amount of governance problems in Africa, with many countries hostile towards each other. Blockchain can provide the framework for a streamlined African-wide government.
Binance affirms that they want to deploy their capital across Africa to invest in crypto and blockchain projects, and Benjamin Rameau thinks it will be an incredibly profitable investment since the lack of financial infrastructure has been holding back Africa’s economy and job growth. He thinks once Africa has a crypto backbone it will undergo an economic upswing equivalent to an industrial revolution, and Binance will be right in the middle of it.
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