African crypto market has witnessed growth in the adoption of cryptocurrencies in retail transactions. The retail-sized transfers are the highest in the world with an overall transaction volume of 7%, considerably higher than the global average of 5.5%.
Although Africa is the smallest cryptocurrency economy by continent, it is the most dynamic. It has grown massively, receiving over $105.6 billion from July 2020 to mid-2021. In fact, it ranks as the third fastest-growing bitcoin and cryptocurrency economy in the world per Chainalysis. What’s more, Nigeria, South Africa, and Kenya all rank in their 2021 Top 20 Global Crypto Adoption Index.
Nigeria is the biggest bitcoin and cryptocurrency market in Africa with first-quarter trading volume amounting to $99 million. Kenya and Ghana come second and third with $34.8 million and $27.4 million respectively. South Africa trails the four. This signifies that the continent has some of the highest grassroots adoption in the world.
African business people are relying more on bitcoin for commercial transactions. Sending fiat currencies for transactions can be challenging due to regulatory bottlenecks. For context, Nigeria limited offshore debit card transactions to $500 at a time. For that reason, many people have resorted to using bitcoin for their larger transactions.
According to COO and Cofounder Artur Schaback, Paxful has grown over 300% in Kenya over the last year, and 57% in Nigeria. Similarly, P2P transactions account for 1.2% of all Africa’s bitcoin and altcoin transaction volume, the highest in the world. To be specific, 2.6% of bitcoin transactions occur over P2P platforms.
Retail bitcoin and alternative cryptocureency payments in Africa have made significant contributions to the growth of P2P platforms. One of the platforms that has grown significantly is Luno. Africa customers dominate the platform after increasing 271% since January 2020, to reach 4.7 million of the total 7 million customers. The platform has played a great role in the growth of bitcoin adoption by creating infrastructure and introducing local currencies into the crypto marketplace.
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