The most exciting applications of cryptocurrency & blockchain in the African context
An expert community of founders & practitioners provides insight, commentary, & analysis on cryptocurrency & blockchain use cases across Africa.
Afridigest provides ideas, analysis, & insights for Africa-focused founders, executives, and investors, as well as interested observers.
This week, we bring back the Afridigest Thought Circle where an expert community of founders, investors, executives, and thinkers provide insight, commentary, & analysis on a specific question.
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This week, leading founders, CEOs, practitioners & subject-matter experts were asked to reflect on the potential of cryptocurrency & bitcoin across Africa and discuss the most exciting use cases.
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QUESTION OF THE WEEK
What are the most exciting applications of cryptocurrency & blockchain in the African context?
Blockchain & cryptocurrency are said to be disrupting financial services worldwide and emerging/growth markets, in particular, are said to be an ideal backdrop due, among other things, to the relative dearth of legacy systems.
With Africa now being one of the world’s fastest-growing markets for cryptocurrency adoption according to recent media reports, what do you make of the potential for disruptive blockchain-based solutions in the African context and what do you see as the key drivers? What applications of cryptocurrency & blockchain are you most excited about as they apply to the continent? Do you expect more companies to build out Africa-focused blockchain- and crypto-based capabilities in the coming years, and if so what solutions have the most exciting upside in your view?
Co-Founder & CEO, Paxful
Paxful is a leading global peer-to-peer cryptocurrency trading platform with over seven million users to date. The platform announced earlier this year that Nigeria is its biggest market with over 1.5 million users and over $1.5 billion in trade volume to date. Nearly 50% of the wallets hosted on Paxful are from Africa.
Africa is teaching us about the true use cases of Bitcoin and the opportunity it presents for greater financial inclusion. There are several factors that contribute to crypto’s mass adoption in Africa — the biggest being the intense drive and business aptitude of the African youth. Other factors also contribute to the continent’s adoption of crypto, including a lack of financial infrastructure, instability and volatility around local currencies, and high transaction costs on financial transfers.
In terms of exciting applications, Africans are using crypto both to satisfy personal finance needs and for entrepreneurial ventures — this includes remittance, e-commerce, payments, wealth preservation, and social good. What’s most exciting to me is seeing users set up side-hustles and their own businesses, which include remittance, as well as import and export enterprises.
Take Joseph Ebuka for example, a Paxful Peer in Nigeria that buys art pieces with Bitcoin. Most of his earnings are in crypto and it’s more convenient for him to pay for goods and services with Bitcoin. Stories like Ebuka’s have global implications for showing how Bitcoin and other cryptocurrencies are becoming a strong financial contender for everyday transactions.
The potential of blockchain is also massive as it impacts contract management, gaming, land registry, supply chain, and logistics tracking. The exciting application to me is the “blockchain of philanthropy” — which speaks to how blockchain will impact social good. Traditional methods of making monetary donations have proved to be problematic as many individuals lack trust and visibility as to where their money goes. The blockchain not only provides complete transparency, but also minimizes the exchange costs and delays associated with traditional banking. I’ve experienced this firsthand through the Built With Bitcoin Foundation, which I co-founded.
Co-Founder & CEO, Helicarrier
Helicarrier (formerly BuyCoins) develops crypto infrastructure for Africa. Its products include Buycoins, a cryptocurrency exchange; Buycoins Pro, an orderbook for advanced trading; Sendcash, a platform for crypto powered remittances; Sendcash Pay, a suite of developer tools for integrating cross-border payments; and NGNT, a collateral-backed Nigerian Naira stablecoin.
Cryptocurrencies and blockchain technologies in general will leapfrog legacy systems because they offer vastly superior experiences and have the potential to eliminate a lot of the traditional challenges like market fragmentation that are commonplace on the continent. As a corollary: