Nigeria and Africa at large continue to make themselves known in the blockchain and crypto space. Over the past few years, Africans continue to transact with cryptocurrencies as they battle against inflation in their respective countries. Although there seems to be less adoption of blockchain in most countries in Africa, this doesn’t seem to stop the small percentage of Africans from trading in crypto.
According to a report by Chainalysis, Africa’s on-chain cryptocurrency activity has consolidated further onto the 10 largest services in the region by volume, with those services’ share of overall activity in the region rising from 67% in October 2019 to 78% in 2020.
In a conversation with Victor Essien, a crypto trader, and educator, Lightblocks discussed the difficulties facing blockchain in Nigeria and Africa at large and what the future holds.
The Digital Divide in Africa
When talking about the issues with blockchain in Nigeria, one major issue was the digital divide. According to Victor, blockchain is tech-based and has the same issue technology faces. One of such issues is the digital divide. Not everyone is conversant with tech let alone blockchain technology. In Nigeria and Africa, the majority of citizens live in rural areas and are not exposed to the ever-growing blockchain system.
Although there is data that shows Nigeria as one of the top 2 countries that trade bitcoin, it doesn’t reflect the true adoption of blockchain and cryptocurrencies in Nigeria or Africa as a whole. What’s more? This amount comes from the top crypto gurus in Nigeria. The masses and others in Nigeria do not contribute to this number. There are little to no retail transactions with bitcoin or other cryptocurrencies.
If the digital divide can be breached, it will go a long way to driving the massive adoption of blockchain and crypto in Nigeria and Africa at large.
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The Future of Blockchain in Africa
If the present issues facing blockchain in Nigeria or Africa are not addressed, there might be no future for blockchain in Africa. The first step is massive adoption and then one can talk about the future of blockchain in Africa.
Victor emphasized that despite the huge number of crypto transactions in Nigeria, this will not increase the adoption rate in the country. He further explained that the huge number of crypto transactions was from the small percentage of elites who make big crypto transactions.
According to data from Statista in March, 32% of respondents in Nigeria use crypto. Nigeria also ranked eighth in Chainalysis’ 2020 report on cryptocurrency adoption around the world. This surge happened during the EndSARS protest against police brutality where the organization used bitcoin to raise funds for protesters.
Learn Before You Earn
In the last bit of our conversation with the crypto traders, we talked about the newbies in the crypto space. His advice was for newbies and crypto enthusiasts to get financial education.
Most newbies are here for the money. They are looking to make triple of their investments off one trade. That is a downhill no one wants to ride. His advice is to get a mentor and learn how to trade with effective risk management.