Commerce

Kenyan traders burn fingers in Bitcoin craze as markets melt down

Tuesday, May 24th, 2022 08:20 | By

LOSSES: Kenyan crypto traders eager to reap from the bearish crypto market have had their fingers burnt as the market spiralled down bringing even more losses.

Bitcoin first dropped to $37,500 (Sh4.37 million) in February from an all-time high in November 2021 of $69,000 (Sh8.04 million). Kenyans in the crypto space moved in to capitalize on the low prices hoping to make a killing by buying low and selling high.

Towards the end of March bitcoin’s price rose to $47,400 earning them a good return at least on paper. 

This price did not hold for long, when the bitcoin’s price tumbled to $36,000 on May 6, local crypto speculators and traders rushed to online marketplaces to purchase it at the low price hoping that it would spring back to over $40,000 in a few days.

Nearly two months later, the world’s leading crypto is still below $31,000 and at risk of great fluctuation are the over 18,000 other cryptocurrencies that heavily rely on bitcoin’s market performance. 

“I bought it last year at its peak hoping it would hit $120,000 by March. I regret having invested my $4,000 into what now looks like a sinkhole,” Lukato Mukina said. Just like in the stock market, traders usually buy low hoping it is the end of the decline. However, it appears to have been the beginning of the decline.

“I just sold my bitcoin at the price of $30,000. Watching it drop more is painful,” James Oketch said.

Crypto communities

Thousands of Kenyan traders are finding themselves holding an asset whose price is declining daily. Kenya boasts one of Africa’s most vibrant crypto communitiesFinder’s January 2022 Crypto-currency Adoption Index ranks Kenya 12th for cryptocurrency ownership out of 27 countries surveyed globally. 

Kenyan founder of Pesabase, crypto-based money transfer platform William Otiso said, “we expect the market to recover, as usual, we just finished our initial coin offering for our platform which was oversubscribed on coinmarketcap.”

Roselyne Wanjiru, a crypto trader who was unmoved by the tumbling prices, said between 2018 and 2020, she was on the verge of quitting the crypto trade because the uncertainty bothered her. 

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