Cryptocurrency is finding its feet in Africa, as US-based P2P crypto marketplace Paxful is finding out this year with transaction numbers rocketing.
Paxful Inc. operates a peer-to-peer payment logistics platform which focuses on buying and selling of bitcoins. The company has just returned with impressive numbers after its leadership team visited Africa to assess its successes there.
The trip to South Africa, Nigeria and Ghana revealed that Africans are turning to Bitcoin in ever increasing numbers with Paxful’s transactions alone standing at R948 million ($66 million) per month. Over the past year, Paxful transactions from SA increased by 25%, by 60% in Nigeria and by up to 100% in other parts of the continent. For Africa as a whole, Paxful has seen a 225% increase in users in the last 12 months.
The South African economy is struggling but Bitcoin continues to gain popularity with investors, writes bitcoinist.com. In April of this year, the South African Central Reserve Bank (SARB) announced moves towards overseeing cryptocurrency and fintech developments in the country, suggesting rather than taking prohibitive regulatory measures, it would introduce an investigative unit which would promote growth and innovation. The South African Revenue Service also announced a new framework for cryptocurrency taxes.
As a result, cryptocurrency adoption has started growing in the region. AsiaCrypto puts Bitcoin’s continued popularity in South Africa down to the fact that some of the country’s larger asset holders are moving into crypto. “Bitcoin” is now reported to be the trending term on SA Google search.
In South Africa, Paxful is not alone, with Luno recently announcing that it now has two million users spanning 40 countries. Another South African-based exchange, Coindirect, now trades over 40 altcoins. Paxful COO Artur Schaback comments:
“As a company, we’ve learned a lot from African consumers. For instance, we’ve improved our mobile capabilities to cater to the widespread use of smartphones on the continent. Our experience in Africa has strengthened our capability to serve consumers regardless of geographical location or origin.”
In parts of Africa, cryptocurrencies such as Bitcoin have very little speculative value; with local currencies often struggling, cryptocurrencies are often simply used as payment for goods or transferring funds as a more viable and reliable alternative to local fiat.
Recently, countries such as Zimbabwe, South Sudan, and oil-rich Nigeria have all suffered from inflation, while others continue to go through it. In these situations, it is hardly surprising that populations look to a more stable form of monetary solution in their daily lives. Paxful, like other exchanges operating for those on the African continent, is beginning to see this groundswell feed through as Africans turn more readily to P2P cryptocurrency trading as a financial solution to everyday problems.
Ray Youssef, co-founder, and CEO of Paxful suggests Africans have been clever in dealing with financial barriers in some of these countries:
“The people of Africa were educating us. It really wasn’t just Bitcoin and Paxful–it was peer-to-peer finance. These folks were finding ways around all their barriers – whether foreign or domestic – using peer-to-peer finance… The same thing that Uber did for transportation and Airbnb did for hospitality, peer-to-peer financial marketplaces are doing for finance.”
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