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Peer-to-peer lending platforms contributed to the rapid growth of the African crypto market. There’s an increasing need for payments to bypass several restrictions that bank laws impose. The popularity of crypto investment to avoid inflation has played a key role in the crypto market growth. 

Chainanalysis Shares Data on African Cryptocurrency Market Since 2020

Chainalysis, a digital analytics firm, has shared data on the African cryptocurrency market’s exponential growth, especially since 2020. Not only that, a large share of the retail transaction volume is possessed by Africa. It is said to be more than the usual global average.

In a report, Chainalysis stated that the African crypto market is getting stronger with each passing day. The value has increased by a whopping 1200% between July 2020 and June 2021. High adoption rates are seen in places like Kenya, Tanzania, South Africa, and Nigeria. They think that the growing popularity of P2P platforms might be the main cause behind it. In situations where some countries restrict monetary exchange through local banks, crypto is a boon.

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User-Friendly Crypto Products

Chainalysis pointed out that the African crypto market has received $105.6 billion between July 2020 and June 2021. Yet in the market’s overall transaction, it had a share built on “retail-sized transfers”. It turned out to be larger than any other place in the world. It is approximately 7% in contrast to the global average of 5.5%. Popular African P2P platforms are responsible for 1.2% of the entire amount of transactions in Africa.

In many of the African frontier markets, people can’t send money from their bank accounts to a centralized exchange. Hence, they rely on P2P. Crypto products are becoming more user-friendly. They can onboard more people into the crypto economy. It helps them learn that crypto is faster, cheaper, and more convenient.

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Other crypto appeals in this part of the world might be using remittance to get around the government limitation that constricts the number of funds one can send abroad. It is also a way faster and cheaper option to use in international commercial transactions. It’s a very effective way to hold on to your savings to avoid possible turmoil in the value of their flat currency.

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A lot of administrators are trying and planning to release their digital central bank-approved e-currency. Nigeria is holding hands with Australia, Singapore, and Malaysia to release eNaira on 1st October. South Africa’s CBDC is currently under trial. The fiat-pegged digital currency is to see the light of day soon in the African crypto market.