South Africa, Kenya and Nigeria are African regions where cryptocurrencies boomed impressively. Users of the continent prefer Bitcoin and Ethereum, but other cryptocurrencies are also included in their preferences. Although the market lacks media coverage in regard to investments, the truth is that Africa could be the next frontier for cryptocurrency as an increasing number of investors choose cryptocurrencies instead of official financial services.
One of the reasons why people turned to Bitcoin is the high inflation rates. In South Sudan and Zimbabwe, where inflation obliged authorities to print considerable amounts of money, people started investing in Bitcoin more to have an alternative source of income in case the economy collapsed.
Given these aspects, countries like Nigeria have adopted the legal framework for leveraging blockchain technology. At the same time, the African government has already issued their digital coin, called eNaira, to help citizens use digital finance controlled by reliable institutions against cybersecurity risks.
CFK Africa: donating to a good cause
CFK Africa is one of the few NGOs accepting cryptocurrencies as a form of donation through their platform, Engiven. The benefits of donating with cryptocurrency instead of other forms of payment have multiple uses, such as being more tax-efficient. And although the crypto coins are converted to cash upon acceptance, this method helps NGOs get exempted from capital gains tax.
The platform accepts around 26 cryptocurrencies, from Bitcoin and Ethereum to Injective Protocol and Dogecoin. CFK Africa also takes NFTs as a form of support, driving donations and helping to further development and innovation.
Giant tap spewing plastic supported by an NFT community
In Kenya, where citizens need more help than ever, activists from NGOs are funding projects for the people. With the help of the Human Needs Project, a few members got to build a tall sculpture from rubbish collected in Kibera. The funds from this project were accumulated by selling NFTs, whose final sum was $110,000, boosting the project’s trajectory.
The director of the business stated that opening to cryptocurrencies was beneficial and that future projects would be created with this support. The nonprofit already handles issues with garbage disposal and access to drinking water.
Cryptocurrencies help diminish the costly barrier of aid in Africa
Regular forms of payments usually have some limitations as they’re being controlled and monitored by central governments. However, considering that around 8.5% of Kenya’s citizens own crypto, the opportunity to use the coins for social welfare is considerable.
The nonprofit Grassroots Economics Foundation helped raise money through cryptocurrencies in sarafu, a currency in Kiswahili that allows residents to access essentials like food, healthcare and housing facilities. Another business helps African residents get paid for work in Cello coins, a stablecoin. The Celo Foundation, along with the Mercy Corps Ventures, leveraged the microwork pilot system, a form of digital labor that allows people to complete their tasks only with the help of a mobile phone. The benefits of using Celo coins instead of fiat money ensure smaller transaction fees and immediate payment. At the same time, since it’s a stablecoin, people’s wages are not significantly affected by volatility.
Kenyan choreographer sells her dance moves as NFTs
One of the biggest challenges in Africa includes scarce access to electricity and internet connection. However, people with more resources are doing considerable efforts to help those in need, such as Big Mich, a Kenyan choreographer who uses her dancing skills to transform the community. Besides training girls from her community to dance and offering opportunities for growth, Big Mich is also selling her dance moves as NFTs to leverage the funds for poor communities nearby.
Of course, sustainability concerns are addressed, but when it comes to helping an area where the lack of energy and water is prominent, the dancer stated that the benefits might be greater than the disadvantages, at least in this region.
Recent regulatory actions accept the use of blockchain technology in Africa
As of the latest technological developments and demands from African communities, governments are taking a serious approach to adopting blockchain and cryptocurrencies to drive innovation. Nigeria, for example, agreed on a regulatory project to accelerate Bitcoin adoption by approving the “National Blockchain Policy for Nigeria” by the country’s federal executive council.
Along with this change, the Security and Exchange Commission is working to build a reliable token policy framework to spread awareness of the benefits and risks associated with investing in cryptocurrencies. Nigeria, South Africa and other African regions are bringing innovation into the whole continent by using cryptocurrencies like Bitcoin for smaller transactions. After central governments’ crypto ban in 2021, Africa re-opened its regulation towards working with crypto and leveraging the benefits.
High crypto usage in Africa continues despite economic challenges
Although the continent faces diverse challenges, a few African countries like Kenya, Nigeria, South Africa and Tanzania are working hard to make cryptocurrencies available for people considering the high usage from regular users. However, retailers also are using cryptocurrencies and diversifying their transactional opens to foreign markets.
In spite of the bear market last year, crypto transactions increased considerably in Sub-Saharan Africa. Experts state that users don’t really have the purchasing power to affect the market that much or be affected by bearish trends. Plus, people trade crypto for practical reasons, considering their wage struggles.
Africa’s emerging crypto economy is striking the world and making considerable changes to regular people. Seeing the success of cryptocurrencies in Africa, more countries are making crypto transactions legal, such as Namibia, while others remain reticent considering the financial struggles. The current state of some more developed areas allows them to handle crypto transactions at a less significant level. However, let’s not forget the negative impact Bitcoin acceptance had on countries like El Salvador, where many people lack internet connection or mobile phones. At the end of the day, technology is beneficial as long as the country’s economy can sustain considerable effort.
African NGOs are including cryptocurrency donations and NFT actions to help their communities. With the help of crypto fundraising in Africa, more people can access drinkable water, healthcare and a place to sleep.