Kenya, Nigeria outshine peers as crypto trading picks up pace in Africa
CURRENCY: Kenya continued to top Africa in peer-to-peer cryptocurrency trade volumes in the first quarter of the year even as the United States warned over the prospect of a contested and leaderless world in the coming decades due to rising adoption of cryptocurrencies.
According to new data from Chainanalysis.com, a crypto tracking platform, peer-to-peer (P2P) bitcoin trade volumes in Kenya and Ghana surged in first quarter of 2021, with the two countries now ranked second and third respectively.
Nigerian naira
The platform shows that cryptocurrency purchases using Kenya shillings were only second to those done using the Nigerian naira. Ghanaian cedi, South Africa rand, Central African Franc followed in the third, fourth and fifth place consecutively.
Nigeria, thanks to its huge population and falling trust in the governance system and a devaluation of the naira, continued to lead the continent in crypto transactions.
“Many African countries suffer from severe currency devaluation and instability, which makes it difficult for residents’ savings to hold their value. Cryptocurrency can act as a more stable value store for people living under these conditions,” the report notes.
The price of Bitcoin rallied to Sh6 million in April 2021 up from Sh4 million in January and from as low as Sh500,000 last year in March, making many people rich at a time when most had lost their jobs and are quickly accumulating debt.
On the other hand, volumes in South Africa, which occupied second place in 2020, dropped marginally.
Consequently, South Africa has now been relegated to the fourth position the data shows.
The Kenya government has gone quiet on the crypto market since 2016 when the Central Bank of Kenya warned the public against trading in the cryptocurrencies, saying those using the parallel currencies have no legal recourse.
“There is rising tolerance and acceptance of the new blockchain technologies in Kenya and the world. People are beginning to accept bitcoin as an alternative investment vehicle, that is part of the reason it is appreciating quickly,” said William Otiso, a crypto investor in Kenya.
Rising corruption and other crimes are eroding confidence in the government forcing some Kenyans to keep their money in other havens.
South Africa saw a 10 per cent decline in bitcoin trading for January with data showing that several traders either suspended trading activity or withdrew investments in response to government’s clampdowns.
