Cryptocurrency adoption in the world has been increasing over the last few years. After the boom of Bitcoin, people realised crypto’s benefits and potential, and they couldn’t get enough of it. In Africa, cryptocurrency adoption has led to people investing millions of dollars in cryptocurrency. But although cryptocurrency adoption in Africa is high, a few problems limit the potential the currency would have in the continent. The population of people who have adopted cryptocurrency in Africa has had to overcome many challenges to make their investments worthwhile. Some of the challenges barring cryptocurrency adoption in Africa include the following;
1. Access to the internet:
The internet is one of the most important components of cryptocurrency. Cryptocurrency requires an internet connection for its progression. The world is going online, and almost everything can be done online today. The internet has also turned the world into a global village, with people able to communicate with others worldwide.
Moreover, crypto gains its value from mining, which involves processors specifically made to develop blockchain leading to the development of crypto. The processors require an internet connection to develop the blockchains.
With cryptocurrency, people cannot physically touch their money, only access it through devices connected to the internet. This means people must be online to transact or do anything with their money. Furthermore, users of crypto need the internet to trade cryptocurrency. Most people who have adopted cryptocurrencies in Africa are involved in crypto trading. This trade involves buying and selling cryptocurrencies at different values. As a result, people can easily profit from the highly volatile market by buying the currency when its value is low and selling when its value increases. From that, it is clear that an internet connection is necessary for cryptocurrency to succeed in Africa.
Currently, some countries are leading the charge towards improving internet connection in Africa. Some countries, such as Kenya, South Africa, Nigeria, and Ghana, have the best internet connection in Africa and rank highly globally. Others are lagging and challenging the full adoption of cryptocurrency in Africa. Some countries are taking action to solve this problem. A good example is how Kenyan companies, for example, Telkom Kenya developed and adopted 4G Balloons in remote areas where it would be expensive to connect via Fiber. Wi-Fi supplies in Africa have also increased in the last five years, with more people preferring to pay to have their homes connected to the internet. If more of these actions were taken on a larger scale, cryptocurrency adoption in Africa would continue to increase, but at the moment, this is causing delays in the adoption.
One of the main problems in Africa is getting the finances to start a business and other things. This problem starts with the governments, with the evidence being the huge loans acquired by various African governments to develop infrastructure and other projects. Crypto mining requires people to have real estate or a place to store their processors to develop the blockchain to create value. Some activities or investments required to adopt cryptocurrency might be too huge for some people to venture in alone.
The best action and advice that people venturing into cryptocurrency without a lot of the initial investment capital required for big projects might be an issue. The processors, wiring, and cooling investment might be too high. In Africa, the best thing is to start small and grow with time. Most people who have adopted cryptocurrency in Africa are involved in trading since this is the least expensive way to get into crypto. With a couple of months’ worth of savings from a minimum wage job, a person can get into crypto trading and start earning something significant frequently.
3. Poor Leadership
The third problem facing cryptocurrency adoption in Africa is poor leadership in African countries. Most African countries face problems such as corrupt leaders that can easily be bribed by other governments, corporations, and organisations to support them or avoid implementing specific policies in their countries. The other problem with African leadership is that other powerful governments sometimes control them. A good example is how France still controls and manipulates the Democratic Republic of Congo’s government.
When crypto is adopted, people might prefer to use crypto rather than other currencies that lose their value. When this happens, other governments might try to limit cryptocurrency adoption in Africa since the currency risks their financial position. As a result of poor leadership and some countries’ unwillingness to support crypto, problems such as banning and setting up policies against it occurred across the continent. In the last few years, as adoption in the continent was increasing at an astronomical rate, some leaders banned crypto instead of putting in place guidelines.
4. Lack of Awareness
This is a major problem that is slowing down cryptocurrency adoption in Africa. People should be aware of crypto and its benefits to the national and local economy and each individual involved in cryptocurrency. When people are not informed about the specifics that make cryptocurrency a good investment, they will not participate. The solution to this problem is education. It’s a good thing some organisations, such as Crypto in Afrika and many more across the continent, have been developed to educate on the endless possibilities that people might benefit from when they invest in cryptocurrency. Along with all the problems listed above, lack of awareness is the easiest problem to solve and might be the key to a transformed Africa.