Category Archives: Coindirect

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Paxful P2P Claims Africa Has the Largest Bitcoin Trade Volume

Cryptocurrency is finding its feet in Africa, as US-based P2P crypto marketplace Paxful is finding out this year with transaction numbers rocketing.

Paxful Inc. operates a peer-to-peer payment logistics platform which focuses on buying and selling of bitcoins. The company has just returned with impressive numbers after its leadership team visited Africa to assess its successes there.

The trip to South Africa, Nigeria and Ghana revealed that Africans are turning to Bitcoin in ever increasing numbers with Paxful’s transactions alone standing at R948 million ($66 million) per month. Over the past year, Paxful transactions from SA increased by 25%, by 60% in Nigeria and by up to 100% in other parts of the continent. For Africa as a whole, Paxful has seen a 225% increase in users in the last 12 months.

The South African economy is struggling but Bitcoin continues to gain popularity with investors, writes bitcoinist.com. In April of this year, the South African Central Reserve Bank (SARB) announced moves towards overseeing cryptocurrency and fintech developments in the country, suggesting rather than taking prohibitive regulatory measures, it would introduce an investigative unit which would promote growth and innovation. The South African Revenue Service also announced a new framework for cryptocurrency taxes.

As a result, cryptocurrency adoption has started growing in the region. AsiaCrypto puts Bitcoin’s continued popularity in South Africa down to the fact that some of the country’s larger asset holders are moving into crypto. “Bitcoin” is now reported to be the trending term on SA Google search.

In South Africa, Paxful is not alone, with Luno recently announcing that it now has two million users spanning 40 countries. Another South African-based exchange, Coindirect, now trades over 40 altcoins. Paxful COO Artur Schaback comments:

“As a company, we’ve learned a lot from African consumers. For instance, we’ve improved our mobile capabilities to cater to the widespread use of smartphones on the continent. Our experience in Africa has strengthened our capability to serve consumers regardless of geographical location or origin.”

In parts of Africa, cryptocurrencies such as Bitcoin have very little speculative value; with local currencies often struggling, cryptocurrencies are often simply used as payment for goods or transferring funds as a more viable and reliable alternative to local fiat.

Recently, countries such as Zimbabwe, South Sudan, and oil-rich Nigeria have all suffered from inflation, while others continue to go through it.  In these situations, it is hardly surprising that populations look to a more stable form of monetary solution in their daily lives. Paxful, like other exchanges operating for those on the African continent,  is beginning to see this groundswell feed through as Africans turn more readily to P2P cryptocurrency trading as a financial solution to everyday problems.

Ray Youssef, co-founder, and CEO of Paxful suggests Africans have been clever in dealing with financial barriers in some of these countries:

“The people of Africa were educating us. It really wasn’t just Bitcoin and Paxful–it was peer-to-peer finance. These folks were finding ways around all their barriers – whether foreign or domestic – using peer-to-peer finance… The same thing that Uber did for transportation and Airbnb did for hospitality, peer-to-peer financial marketplaces are doing for finance.”

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Digital Currency Ecosystem in Africa Grows, But More Connectivity Needed

A new report by the International Telecommunications Union (ITU) has outlined that Africa will need to invest more in internet connectivity in order to maintain the continent’s current pace of cryptocurrency adoption.

The popularity of Bitcoin in Africa continues to grow as a result of the presence of cryptocurrency exchange platforms. There are benefits to cryptocurrency ownership that are unique to the African continent, many devolving from the widespread unstable economic conditions.

Owning and trading in cryptocurrencies is a trend on the rise in countries across the globe. The markets in the USA and Asia have typically gained media traction, while the phenomena in Africa is left largely uncovered. Moreover, a large number of recognized exchanges don’t offer services in Africa, whereas, some recognize the significant marketplace that includes many Africans who do not have access to formal bank accounts.

If Africa is to be the next boom as many experts are currently predicting, it will need to make major changes to its telecommunications infrastructure across the continent, as indicated by the ITU report. The report shows that to connect the majority of Africans to the internet will cost as much as $450 billion.

Currently, governments on the continent spend significantly less than the global average with most countries spending three times as much on connectivity. Low education levels and the high cost of internet capable devices have been cited as contributing factors to the current slow uptake of the internet in many areas of the continent.

The uptake of digital currency has been prolific in Africa over the past two years, with many countries taking on the advantages that currencies such as Bitcoin offer over local fiat currencies. Kenya, Ghana, Uganda, Nigeria, South Africa, and Zimbabwe have all shown a significant increase in crypto adoption.

Coindirect co-founder Stephen Young says that Africa has unique problems and these must be considered in any startup plan for cryptocurrency adoption on the continent. He feels that current exchanges don’t take these into consideration. In terms of African fiat currencies, Young identifies their systemic volatility, insecurity and lack of governance as factors that the crypto space need to take on board: He argues:

“If Africans are to benefit from the cryptocurrency revolution we need make it easier to buy, store and trade cryptocurrencies. As Africans, it is our responsibility to help build the infrastructure and we need to be a part of the revolution.”

It is clear that this “infrastructure” depends on connectivity. ITU reveals that out of the 52 percent of the world’s population who remain unconnected to the internet, the majority of these live on the African continent.

One country is attempting to address this disparity. Rwanda has managed to achieve a 90 percent broadband spread with its nationwide rollout of optical fiber throughout a larger part of the country. The project began in 2009 in order to boost broadband services and attract foreign business investment.

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African Crypto Movement Learns from Past to Push Forward

An examination of Google Trends this year illustrates how the African continent is waking up to cryptocurrency-related products and exploring the sector for innovative opportunities.

The popularity of Bitcoin in Africa continues to grow, enabled by the presence of a greater number of cryptocurrency exchange platforms. There are benefits to cryptocurrency ownership unique to the continent of Africa, many devolving from the widespread unstable economic conditions.

Google searches reveal that Ghana, Nigeria and South Africa are frantically searching online when it comes down to cryptocurrency and Bitcoin.

The M-pesa mobile money platform that started over 10 years ago as a Vodaphone pilot scheme for Safaricom and Vodacom, the largest mobile network operators in Kenya and Tanzania, is now an African giant. It is convenience that has made a massive impact in these countries, allowing users to deposit, withdraw, transfer money and pay for goods and services from their mobile phone.

So big has the company become it has now reached South Africa and further afield in Afghanistan, India, Romania and Albania.

The mobile phone has become Africa’s most significant innovation, connecting people across the continent in remote regions, also providing a host of innovative apps, thereby making more conventional and expensive forms of communication obsolete. Africa’s early steps in the cryptocurrency space, with crypto users doing their business through P2P networks, avoiding the limitations of banks and exchanges, neither of which many people have access to, show that the mobile phone is key.

Michael Kimani, the chairperson of the Blockchain Association of Kenya, draws a comparison to the early days of M-pesa to the current movement towards crypto and P2P solutions as users innovate to circumnavigate the drawbacks of trading. In the pre-M-Pesa period, people would trade airtime between themselves to escape inflated telecoms charges. He feels similar is happening now with crypto trading. He argues:

“These informal networks, resemble the airtime currency informal networks of pre-2006 that powered remittance payment networks before M-Pesa became a thing.”

A further accelerant could be just around the corner with last month’s launch of an African-focused cryptocurrency exchange called Coindirect. Co-founder Stephen Young says that Africa has unique problems and these must be considered in any startup plan for cryptocurrency adoption on the continent. He feels that current exchanges don’t take these into consideration.

In terms of African fiat currencies, Young identifies their systemic volatility, insecurity and lack of governance as factors that the crypto space need to take on board: He argues:

“If Africans are to benefit from the cryptocurrency revolution we need make it easier to buy, store and trade cryptocurrencies. As Africans, it is our responsibility to help build the infrastructure and we need to be a part of the revolution.”

The South African exchange allows users to buy, convert, store, send or sell more than 40 cryptocurrencies, combining a peer-to-peer marketplace, wallets and an exchange to allow customers to access cryptocurrencies from their local currency.

 

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Dip in South African Economy Sees Rand Down and Rise in Bitcoin Trading

The South African economy is struggling with the Rand at a six-month low, but bitcoin continues to gain popularity with investors, writes bitcoinist.com.

In April of this year, the South African Central Reserve Bank (SARB) announced moves towards overseeing cryptocurrency and fintech developments in the country, suggesting rather than taking prohibitive regulatory measures, it would introduce an investigative unit which would promote growth and innovation. The South African Revenue Service also announced a new framework for cryptocurrency taxes.

As a result, cryptocurrency adoption has started growing in the region. AsiaCrypto puts Bitcoin’s continued popularity in South Africa down to the fact that some of the country’s larger asset holders are moving into crypto. “Bitcoin” is now reported to be the trending term on SA Google search.

Other factors according to AsiaCrypto is that South Africa actually benefited from the recent dip in crypto prices during 2018, as this has enabled the creation of new startup businesses. The struggling economy has also aided Bitcoin’s rise in popularity as massive selloffs in the financial market due to the Rand losing value has pushed some investors towards alternative markets, with cryptocurrency becoming a viable choice.

A recent survey conducted in South Africa maintained that one in four respondents confirmed they plan to invest in cryptocurrency in the future, and another 15% said that they would invest in mining equipment. Although, warnings of electricity hikes of up to 50% in the near future may well dampen the enthusiasm of prospective bitcoin miners.

Apart from a recent ATM being installed in Johannesburg, the cryptocurrency community has access to exchanges such as Luno and Paxful who are reportedly doing a healthy trade in Bitcoin with other pairs available. Also, the platform Coindirect enables users to buy and sell Litecoin, Bitcoin Cash, and Ripple.

A new trading platform is scheduled to be opened later this year by asset management company Sygnia.

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