Although Africa is regarded as one of the smallest cryptocurrency markets, according to the preview of Chainalysis’s cryptocurrency geography annual report, the region has “some of the highest grassroots adoption rates in the world.”
Africa volume is mainly composed of retail transfers
The latest Global Encryption Adoption Index from Blockchain Analytics confirms the observations of encryption adoption in Africa. According to the index, four African countries, Kenya, Nigeria, South Africa and Tanzania, all entered the top 20.
In addition to being one of the regions with the highest grassroots adoption rate, the cryptocurrency market in Africa “increased more than 1,200% in value received last year.” According to reports, the market also received USD 105.6 billion worth of cryptocurrency between July 2020 and June 2021.
As the latest preview shows, Africa “has a larger share of its overall transaction volume than any other region, just over 7%, compared to the global average of 5.5%.”
Africa’s P2P transaction volume surges
Chainalysis also pointed out that “P2P platforms are especially popular in Africa compared to other regions.” In fact, the preview admits that “no other region uses P2P platforms at a higher rate than African cryptocurrency users.”
Cross-regional transfer is another indicator showing that Africa is more active than other markets. Chainalysis preview description:
“Cross-regional transfers have a larger share of the African cryptocurrency market than any other region, accounting for 96% of all transactions, and the total of all regions is 78%.”
Regarding the surge in P2P transaction volume, the Chainalysis team speculates that “many African cryptocurrency users not only rely on P2P platforms as the entrance to cryptocurrencies, but also rely on remittances and even commercial transactions.” The restrictions imposed by some regulatory agencies on cryptocurrencies are also believed to be promoting Use of P2P platform.
In countries like Nigeria, more and more people are turning to cryptocurrencies to “preserve their savings under bad economic conditions.”
Do you agree with Chainalysis’s findings? Tell us what you think in the comments section below.
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