Saturday, January 28, 2023
  • The Southern African nation now boasts a cryptocurrency ownership rate of 12.45 per cent of citizens
  • Nigeria has the largest cryptocurrency ownership in Africa, with over 22 million citizens owning cryptocurrency
  • Nigeria, Tanzania, Morocco, Cameroon and Benin all have bans on cryptocurrency. It seems citizens have not let this get in the way of getting in on crypto

South Africa has dethroned Kenya as the country with the highest cryptocurrency ownership rate, according to data published by aggregator Triple-A. The Southern African nation now boasts a cryptocurrency ownership rate of 12.45 per cent of citizens.

Nigeria, Africa’s most populous country, has the highest number of crypto-owning citizens at 22,332,791. Triple-A’s website shows 33 out of 54 African countries and their cryptocurrency ownership data. There are some interesting insights we can pick from the data regarding cryptocurrency in Africa.

  • South Africa has the highest cryptocurrency ownership rate in Africa
  • Bans on cryptocurrency have not deterred trading
  • Cryptocurrency ownership rates are largely under 5 per cent

Country

Ownership

% of population

1

South Africa

7712116

12.45%

2

Kenya

6101599

11.60%

3

Nigeria*

22332791

10.34%

4

Ghana

1391703

4.30%

5

Togo

363963

4.21%

6

Tanzania*

2323874

3.82%

7

Morocco*

1151520

3.16%

8

Cameroon*

867387

3.12%

9

Mozambique

788274

2.40%

10

Benin*

291798

2.29%

11

Egypt*

2372936

2.26%

12

Zambia*

424937

2.24%

13

Democratic Republic of Congo*

2038909

2.15%

14

Uganda*

984732

2.01%

15

Cote d’Ivoire*

546733

1.97%

16

Rwanda

262937

1.94%

17

Zimbabwe*

271307

1.78%

18

Mauritius

23208

1.77%

19

Algeria*

823534

1.77%

20

Madagascar

509460

1.76%

21

Tunisia*

202715

1.69%

22

Senegal*

284854

1.62%

23

Namibia*

41961

1.59%

24

Mali*

326290

1.53%

25

Angola

532986

1.53%

26

Ethiopia*

1827706

1.52%

27

Malawi

294542

1.47%

28

Botswana

34245

1.42%

29

Libya*

92310

1.30%

30

Seychelles

1257

1.26%

31

Burkina Faso*

274255

1.25%

32

Gabon*

7221

1.03%

33

Cabo Verde

5395

1.00%

South Africa leads the way

South Africa leads the way in terms of ownership rate, with 12.45 per cent of the population owning cryptocurrency. The South African Reserve Bank deputy governor Kuben Naidoo recently spoke about a regulatory framework for cryptocurrencies coming within 18 months. The country also has a central bank digital currency (project Khokha) in the pilot phase.

Nigeria largest outright

Nigeria has the largest cryptocurrency ownership in Africa, with over 22 million citizens owning cryptocurrency. This is not surprising as Nigeria is the most populous nation in Africa. The country launched Africa’s first and only operational central bank digital currency to date, the eNaira. The central bank digital currency has not faired well with only 0.28% of Nigerians opening wallets for the digital currency in the first 6 months. Compared to 10.45% of the population owning cryptocurrency.

Bans are not an obstacle

5 of the top 10 countries on the list have existing bans on cryptocurrency trading. Nigeria, Tanzania, Morocco, Cameroon and Benin all have bans on cryptocurrency. It seems citizens have not let this get in the way of getting in on crypto. 20 of the 33 countries made to the list have bans on cryptocurrency; that is more than half of them. It’s important to note that Morocco is planning a turnaround and will introduce cryptocurrency regulation soon.

Progressive and Neutral nations lead

3 of the top 5 countries have a record of being progressive towards digital currencies.  South Africa is on record with the revenue authority SARS and the central bank working on digital currency and regulation for cryptocurrency. Kenya is a neutral nation when it comes to cryptocurrency.

The country has not outlawed cryptocurrency trading but maintained that cryptocurrencies are not legal tender and people should trade with caution. Ghana also has a neutral stance similar to Kenya’s. While cryptocurrencies are not recognised as legal tender within the nation, there is no ban on ownership of cryptocurrency. 5th placed Togo is also neutral with no prohibition or regulation on using cryptocurrencies.

Ownership rates are still low

Only the top 3 countries have ownership rates over 10%; all other nations fall below 5% ownership rates. While bans have not completely stopped people from accessing cryptocurrency, they have made it more difficult.

Fraudsters have preyed on people amid the confusion and sold pyramid and Ponzi schemes to invest in cryptocurrency and related items. This has done damage to the image of cryptocurrency in Africa. There are also undeniable fundamental issues such as internet access, low utility and lack of understanding of cryptocurrencies.

The Central African Republic absent

In April, the Central African Republic became the first African country to adopt the cryptocurrency Bitcoin as legal tender. The absence of the country from Triple-A’s statistics leaves much desired.

While the country has a low internet penetration rate of around 15%, it would be a great case study to gauge just how much making a cryptocurrency legal tender can impact the adoption rate. One of the major problems with cryptocurrency at present is low utility. Still, in a country where it is legal tender, you can see more clearly people’s attitude towards it without the constraint of utility.

With many African countries working on regulation, central bank digital currencies or both, we expect these statistics to change over time, hopefully for the better gradually. Digital currency developers can only address concerns around utility, while fundamental matters such as internet access and electricity access will need to be addressed by African governments.

Read: The state of cryptocurrency adoption in Africa per country

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