Regardless the prevailing market conditions, digital currency adoption, primarily across emerging economies, continues to grow unabated. This reality, in turn, is driving investor interest in these potential markets.
For instance, the African blockchain tech landscape is at present attracting significant financing from prominent deal financial resources corporations likewise as angel investors. Recently, the Central African Republic (CAR), following the footsteps of another emerging economy El Salvador, approved the use of Bitcoin (BTC) (BTC) as a legal tender, further increasing investor confidence.
As reported by the latest report by Nation, African blockchain tech corporations raised approximately $304 Million during the 1st and second quarters of 2022, which is almost 3 times higher than the total $127 Million collected by startups in the region during all of 2021. The report further clarified that in the 1st 3 months of 2022, deal financial resources funds invested $91 Million into a few African cryptocurrency startups. In the second quarter, the inflow grew by a staggering 134 percent to reach $213 Million. This came at a time when the broader cryptocurrency market was stumbling due to the Terra (LUNA) implosion, rising inflation, and ongoing geopolitical challenges.
Seychelles-based cryptocurrency exchange KuCoin raised $150 Million, which has since been dubbed the “mega deal” for the African blockchain tech market. Pan-African cryptocurrency exchange Mara and Nigerian cryptocurrency startup raised $23 Million and $10 Million each, while Congo-based Jambo raised $30 Million and South African exchange VALR raised $50 million.
Emerging Economies Love Bitcoin
Back in the fourth quarter of 2021, when the cryptocurrency market was touching fresh highs, a few crypto-centric awareness and educational campaigns were launched across the African continent, the fruits of which are becoming increasingly evident in the previous few months.
For instance, a group of distributed ledger technology (DLT) specialists based out of East and West Africa under the umbrella of Jelurida Africa launched the first-ever East Africa Blockchain Tech Expedition to educate locals on the advantages and advancements in blockchain tech and cryptocurrency a year ago. Other organizations like Emurgo Africa, the Cardano (ADA) Foundation’s commercial wing, have likewise actively invested in a range of awareness and educational programs to accelerate the widespread adoption of technology of Blockchain Tech and cryptocurrency.
Thanks to these efforts, a few mainstream businesses around the region have started integrating technology of Blockchain Tech into their existing models, further contributing to the growing adoption. Nigerian digital payments company Interswitch and Senegal’s fintech firm Wave are between the tech unicorns to embrace the nascent technology. Another notable Pan-African incubator project, Adrian Labs, has likewise entered the scene to support the region’s startups and entrepreneurs using blockchain tech, Artificial Intelligence (AI), and other emerging technologies.
Along with deal financial resources interest, an increasing number of Africans are adopting digital currency as their go-to source for payments, transfers, and even savings. Overall, numerous African countries are experiencing a surge in cryptocurrency adoption as residents continue to battle regional challenges like inflation and devaluation of their local currencies.
Another reason behind the increased adoption is the growing number of tech-savvy young adults across the African region, paired with the increased use of smartphones and the internet. In its latest report, Finbold reported that Nigeria now ranks as the world’s most crypto-obsessed country, with a Google trends search score of 371.
Recently, digital currency exchange AAX commissioned a survey in conjunction with Forrester Consulting to assess digital currency adoption across Africa, Latin America, Southeast Asia, and the Middle East. Per the reports, the awareness and adoption of digital currency, primarily Bitcoin (BTC) (BTC), is at an all-time high in these regions, with Africa leading the chart.
Forrester Consulting’s survey outlines that the majority of the African respondents have indicated that they use Bitcoin as the preferred method to transfer funds domestically and internationally. Nearly 46 percent of respondents pointed out that they use Bitcoin to make payments and transfers, while 56 percent stated that they use it to preserve longstanding value, and 52 percent stated that they use it as an financing tool.
On future of the blockchain tech and cryptocurrency in Africa, Jelurida Africa’s Managing Director, Mr. Adebajo, describes, “Most African governments are more interested in building local capacity. So, if the strategy is to win the attention of the Government, more efforts are to be placed on training developers from within Africa. Despite the fact that experience likewise matters a lot when deploying sophisticated solutions, this is where foreign developers would come in handy. When such a need arises, we will be willing to work with foreign entities to realize the goals of the projects.”
“We have spent the last couple of months building prototype solutions across diverse fields. While we continue to engage the government and hold meetings and meetups, we likewise strategy to hold a Pan African Hackathon in collaboration with some other big players in the space,” stresses Adebajo. “ On the other hand, most importantly, we intend to launch some big solutions specially tailored for Africans before the end of Q4 2022.”
Amid this promising backdrop, cryptocurrency has transformed the African landscape, laying the foundation for the African blockchain tech ecosystem of the future while likewise allowing local talents to connect with the brightest minds and resources from the broader cryptocurrency community.