Over the past couple of years, Africa has been widely reported as one of the fastest-growing crypto markets with widespread crypto adoption.
- The African crypto scene continues to draw significant attention from different global spheres.
- Startups in Cameroon have not yet embraced cryptocurrency as a fundraising strategy, and they continue to rely on conventional fundraising tools.
- Today, cryptocurrencies find use in much more than just trading for profit.
Africa’s crypto scene outlook
The African crypto scene continues to draw significant attention from different global spheres. The attention emanates from the fact that the continent has seen the crypto ecosystem grow considerably.
Over the past couple of years, Africa has been widely reported as one of the fastest-growing crypto markets with widespread crypto adoption. With an average of 4.2% global crypto economy, Africa boasts 53 million crypto users, the second after Asia.
Africa’s crypto adoption growth is driven by some of the highest grassroots adoptions globally, crypto-based remittances, the use of crypto to preserve wealth, and growing popularity in peer-to-peer (P2P) platforms.
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Africa’s interest in digital currencies comes as the use of fiat currencies declines in major African economies, with consumers adopting electronic payment methods such as Lipa Na M-PESA, credit cards and payment gateways.
The growth and the adoption in individual nations will play a massive role in the collective, sustained expansion of Africa’s crypto market. Amid the regulation headwinds, different nations must chart their separate paths and make clear their stance on digital assets. One country whose contribution will remain monumental is Cameroon.
Cameroon is experiencing steady and progressive adoption of cryptocurrency. Trading crypto is neither regulated nor banned in Cameroon. Consequently, anybody in Cameroon may create their digital currency and sell it to the general population in Cameroon and overseas for several purposes.
Cameroonians may purchase and trade cryptocurrencies without the control of the government, and crypto initiatives in Cameroon strive to follow the applicable international (soft) regulations and norms.
P2P crypto trading in Cameroon
Cameroonians utilize peer-to-peer trading to obtain stablecoins for trading or holding as a reserve. Since they do not have much to choose from, Cameroonians acquire crypto over the counter. None of Cameroon’s top 20 crypto exchanges allows FCFA currency as a form of payment through Visa.
Consequently, Cameroonians may acquire digital assets generated in their territory that have little or no value on international exchanges. They can exchange them for other coins on exchange platforms or purchase them via a broker at a much higher cost than they could have had on cryptocurrency marketplaces.
When major cryptocurrency exchanges permit direct purchases in FCFA and provide a trading pair on exchange in FCFA, P2P trading in Cameroon will probably decline.
Fast-tracking cryptocurrency as a valuable tool for raising investment capital
Other channels for generating cash are deeply and culturally entrenched in society. Moreover, the widespread ignorance about blockchain poses an additional challenge. As a result, crypto entrepreneurs now leverage cryptocurrencies in a small circle to generate financing for their ventures. Incentives remain necessary to move cryptocurrency assets into the mainstream. In this regard, NFTs are more likely to thrive in future.
Several fraud schemes are presented to Cameroonians via WhatsApp and Facebook groups, offering unrealistic returns on investment. People generally fall into these traps because the high cost of living and the prospect of fast money is appealing.
Consequently, authoritative crypto actors in Cameroon are urgently required to propose regulations to reestablish confidence in crypto assets as an investment in the consumer law scenario.
Cryptocurrency as a payment means in Cameroon
Several merchants in Cameroon accept cryptocurrency as payment since it is less expensive and quicker than FCFA (XAF). To some degree, crypto-assets provide several benefits for international trade in Cameroon. Cryptocurrency moves freely, allowing hastened delivery of products and services. The payment evidence is computationally irreversible, and the gas cost may be waived in rare cases.
Because of its inherent reliability, USDT is Cameroon’s most often utilized cryptocurrency for trade. Global investments in digital assets are also being explored; however, this is a minor phenomenon. Experts anticipate an increase in tandem with the democratization of cryptocurrency.
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Non-Fungible Tokens (NFTs) and their role in trade facilitation and economic growth
Legal tender is not the only consideration for digital assets. Creators can represent art, music, title and proof of ownership, invoices, and bills of lading through digital assets. Non-fungible tokens (NFTs) have fostered a new sector with far-reaching consequences.
For example, tokenizing real estate might protect against the illegal sale of land or property without the legitimate owner. The blockchain offers low-cost, computationally irreversible evidence of ownership.
Land and houses may be listed on the blockchain. Given Cameroon’s rapid real estate growth, digital assets will offer a quick and cost-effective land management system.
The crypto sector is diverse, with mining, trading, and selling digital assets serving a variety of functions. Each of these aspects has the potential to generate revenue for economic growth.
The need for education and regulation of crypto in Cameroon
The lack of regulations in Cameroon is designed to safeguard prospective customers, whether consumers or investors. However, this creates a gap allowing fraudsters to grow, raising widespread misconceptions or suspicion in one of the biggest revolutions of this century. Consequently, this affects crypto adoption negatively.
The majority of individuals admit to being unfamiliar with cryptocurrencies. Nonetheless, crypto often stands out as a viable investment opportunity without explicit knowledge of the technology that underpins it: the blockchain. This scenario is not unique to Cameroon. There is widespread and universal agreement in the cryptographic assets business on the need for training and education.
Binance has remained the forerunner in cryptocurrency education in Africa. In line with the need to continue its legacy as a leading crypto education promoter, Binance opened a training centre in Yaoundé, Cameroon. In collaboration with Inoni Tech, the initiative will provide resources and training for young people across Francophone Africa.
The crypto education hub, inaugurated on August 25, will act as a training centre for in-person blockchain education. In addition to providing crypto education and up-to-date cryptocurrency news, the centre will host regular in-person events.
Today, cryptocurrencies find use in much more than just trading for profit. This industry is evolving at an incredible rate. Crypto assets were initially democratized as a fundraising instrument used by businesses to raise financing without relinquishing ownership of their companies through different procedures.
The world has seen the creation of a new category of digital assets in recent years. The assets range from shitcoins to NFT, stablecoins to Central Bank Digital Currency (CBDC), and a new sort of legal personality (DAO) and Metaverse. Digital assets are establishing a new legal, financial, and social paradigm in Africa, with Cameroon playing a crucial role.
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