Bitcoin is still not so popular in several parts of Africa but it looks like an alternative to several challenges facing the region. Llew Claasen, The Executive Director of Bitcoin Foundation, thinks that the actual levels of Bitcoin acceptance in Africa represents where Bitcoin is on its technology global adoption graph. So, this continent should not be seen separately from the whole world.
“Africa has a lot of challenges where Bitcoin can suggests a vital alternative and this need may see Africa taking more than its honest share of the global Bitcoin dividend. It’s so early in the acceptance of such technology for all of us that it’s difficult to say how it all works in such particular regions.”
There are several factors, which help Bitcoin to become a good bet for African countries. South Africa is one of the main users of the cryptocurrencies. The McKinsey Global Institute showed the opportunity and progress, which can be done with the help of Bitcoin for African economies in 2010. This tendency has continued despite the collapse of global commodity prices and political shocks.
Some members of Bitcoin community believe that Africa need to speed up the rate of structural changes, which is aimed at promoting the competitiveness and diversification and one of the major ways to achieve this, is by reducing the cost of global trade.
Cryptocurrencies are not so persistent in Africa. In some counties, it is very hard to get currency in or out of these countries because of high inflation rates and unwanted delays by financial institutions. Therefore, several Bitcoin-related startups like Bitpesa have started to appear.
Claasen thinks that bitcoin is not soo bad for African countries as somebody can imagine. Forexample, in the last year Bitcoin became one of the best-performing currency in the world. It has also been trading within a surprisingly stable price range. However, some persons does not believe in its stability as a store of value.
“There are only 21 million Bitcoins that will ever be mined. It’s deflationary, much more likely to give long-term capital increase than particular fiat currencies and our recent Brexit experience even shows us that it could displace the gold as a traditional currency hedge.”
Of course, the clients must have a chance to earn Bitcoins, store them and exchange them at point of sale and peer-to-peer, which is not so easy to reach, is such small periods of time.
“It need the same mechanisms as cryptocurrencies more than 50 years to reach prevalent acceptance and even they did not crack it in Africa. That complication, of course, may lead to Bitcoin being adopted first as a store of value and only later as a medium of exchange.”