Non-fungible tokens (NFTs) might not be a very common word for most Africans, but they are becoming increasingly popular. An NFT is a non-interchangeable unit of data stored on a blockchain, a digital ledger, that can be sold and traded. They are digital items that can be bought and sold through blockchain technology. NFTs adoption is forecast to increase around the world in future, especially in Africa. In fact, according to a survey by Finder, countries like Nigeria are expected to have the biggest NFT adoption, from 13.7% to 35.3% – an increase of 22 percentage points.
Last year, the Guardian reported that the global market for NFTs hit $22bn (£16.5bn) as the craze for collections turned digital images into major investment assets. According to the report, data from DappRadar, a firm that tracks sales, showed that trading in NFTs reached $22bn in 2021, compared with just $100m in 2020, and that the floor market cap of the top 100 NFTs ever issued – a measure of their collective value – was $16.7bn. In Africa, Nigerian record label owner Don Jazzy became the pacesetter in the Nigerian music industry in 2021 when he made up to $300,000 in ten minutes on an NFT.
This is according to a report by Technex. Don Jazzy collaborated with a digital artist who created three artworks and had him add a background sound to them. Early this year, Kenyan hip hop star Octopizzo also announced that he would be releasing five tracks as NFTs that anyone in Africa and the world can purchase on OpenSea. The NFT is a collaboration with the Kenyan-based blockchain startup, HoneyCoin. Finder’s cryptocurrency editor, Keegan Francis, notes that the countries with higher levels of NFTs adoption typically have a lower average working-age wage.
‘’People are quitting their jobs because they can make more money trading NFTs or playing NFT play-to-earn games,‘’ he says. ‘’Additionally, NFTs may serve as the nexus through which they enter the cryptocurrency industry in general. Exchanges can be difficult to obtain an account on if you don’t have government identification. These NFT games don’t require ID and allow you to make money. Once you’ve made money in cryptocurrency, you can trade it for whatever else you want, such as Bitcoin or Ethereum.’’
We discussed NFTs adoption in the latest episode of our Crypto in Afrika podcast. Listen to Kanali Nixon, the Tech Editor for TechTrends Media and Brian Adams Kuria, Founder of Cryptocurrency Academy, discussing the future of NFTs in Africa. Brian is also the community manager at CoinMARA.