A New Dawn: Blockchain is Presenting Exciting Opportunities for African Countries

Blockchain Technology is slowly gaining popularity in Africa. To many, blockchain means change and Africa is ripe for a transformation.

Cryptocurrency and Blockchain are still foreign words to many Africans. According to a 2018 report on world payments, Africa is trailing the rest of the world in crypto and blockchain adoption.

Several African governments and forward-looking young people have expressed interest in this dynamic technology; citing the numerous opportunities, that blockchain offers for the continent.

However, what makes Africa different from other continents?

How will blockchain transform African institutions?

How can Africans take advantage of cryptocurrencies to catch up with the rest of the world?

Keep reading to learn more.

What makes Africa Ripe for Decentralization?

Blockchain enhances Regional Trade

Mismanagement, corruption, and problems in transferring funds have for decades hampered continental trade in Africa.

Cross-border fund transfers take too long and are often costly.

To the rescue are smart contracts and cryptocurrencies.

Virtual currencies would allow efficient and safe transfer of funds between traders in different nations.

Smart contracts promote trust and eliminate the need for intermediaries making transactions cheaper.

In a market plagued with counterfeit goods, the adoption of decentralized ledger technology will give assurance to consumers that goods flowing in the African market are of high quality.

Cryptocurrencies Provide a Solution for High Inflation Rates

African countries have some of the highest inflation rates in the World.

Take South Sudan and Zimbabwe for example.

In October 2016, South Sudan recorded an inflation rate of 835.70 percent.

Zimbabwe has also suffered from instances of hyperinflation resulting in the collapse of its currency.

In both, the local currency was ditched and replaced by the dollar. People who had stored wealth in banks lost value.

What can cryptocurrencies do for failing African economies?

Government and financial institution have no control over the supply of cryptocurrencies. Their supply relies on complex algorithms and available computing power.

Cryptocurrencies are also limited — Bitcoin has a fixed supply of 21 million. The limited number of Bitcoins will ensure that that demand will always supersede supply; thus, ensure a continuous increase in value.

This characteristic has resulted in crypto enthusiast labeling Bitcoin as digital gold.

In countries such as Venezuela, citizens have opted to use Bitcoin to escape the decrease in value of fiat currency. The Venezuelan government has also introduced a national cryptocurrency, Petro. The Venezuelan government used Petro to back the country’s currency, as a way of capping the skyrocketing inflation rates.

The adoption of bitcoin, Ethereum, Ripple, and other crypto coins in African nations may provide a solution to the inflation problems that plague numerous nations in the continent.

Mobile Money Services Allow an Avenue for Africans to Invest in Cryptocurrencies

Sub-Saharan Africa has the highest number of mobile money users globally. According to the World Bank, 21 percent of the Sub-Saharan adult population use mobile money services.

The switch to cryptocurrencies from mobile money may be smoother in areas where mobile money transfer has been largely accepted.

Take Kenya for example.

A 2018 report placed Kenyans among the top Bitcoin users in Africa,

Why is this?

Nearly 70 percent of the adult population use M-Pesa mobile money service. Kenyan-based crypto exchanges have incorporated M-Pesa as a payment option making it possible for this 70% to invest in virtual currencies.

How M-Pesa is helping Kenyans buy Bitcoins  Source: Localbitcoin

The adoption of blockchain technology in mobile money transfer platforms would result in faster transactions at lower costs.

Cryptocurrencies Offer a Cheaper Way to Send Money Home

Africans working in the diaspora pay extremely high transaction fees to send money to their families back home.

Take an example of an individual working in America, who wants to send money to his family in Africa.

To send money to the family through services such as Western Union and MoneyGram, this individual would have to visit a retail agent, where he/ she deposits dollars. Alternatively, this individual could choose to transfer funds from their bank account to their Western Union account.

The receiver also must visit a retail agent to receive the money.

Sending less than $3,000 using these money transfer services is easy and takes minutes to transfer funds. However, sending more than $3,000 takes more than one day to transfer funds and is also costly.

Making diaspora remittances through cryptocurrencies would help bypass the high transaction and forex conversions costs, while at the same time providing a faster way of sending money.

With all these Opportunities, What is Preventing Africa from Decentralizing?

For starters, internet proliferation is very low in African rural areas

Despite the high mobile phone usage, only 34 percent of the African population has access to reliable internet connection. This poor penetration of internet services limits crypto investment to residents of major cities only.

Poor internet proliferation has also hampered the implementation of different blockchain-based projects.

Africa still faces the problem of low electrification levels.

A Satellite View of Africa taken at night to show electrification levels Source: University of Michigan CPS

Even in the 21st Century, a high percentage of the African population still lives in the dark. Low electrification levels coupled with high-energy costs hinder innovation and other blockchain related activities such as proof-of-work.

Blockchain-Based Projects in Africa


SPENN is a Rwandan mobile payment platform that uses the decentralized ledger technology to facilitate free and efficient money transfer.

A Norwegian fintech company by the name Blockbonds developed the blockchain-based payment platform in collaboration with I&M Bank of Rwanda.

SPENN will be the first blockchain based rival to Kenya’s M-Pesa mobile-money market dominance.

Twiga Foods Microlending Platform

In a continent where most people work in the informal sector, access to credit facilities is a headache.

Twiga foods, which is a Kenyan logistics company, is solving this problem through a blockchain-based micro-lending platform. The microfinancing solution, which was developed in partnership with IBM, uses a hyper ledger fabric to provide small loans to SMEs.

Small-scale traders can apply and receive small business loans through their mobile phones. In the pilot program, Twiga foods processed over 200 loans.

Twiga foods have also made use of smart contracts, which have reduced the time used to receive, process, and issue loans.

Wisekey Land Registry Platform:

Land ownership in Africa is a major impediment to economic success. Property records are largely unreliable. In some African countries, land ownership issues due to historical injustices or corruption have resulted in civil wars and other conflicts.

In Rwanda, Wisekey, a Swiss crypto security company, has collaborated with Microsoft to develop a DLT-based solution to digitize Rwanda’s land records.

A decentralized land registry would promote transparency in the lands department; thus, rid Rwanda of land ownership issues.


Many Africans work either directly or indirectly in the agricultural sector.

However, problems of land ownership have crippled agricultural activities in African States.

Take Ghana for example.

Land dispute problems exist in almost all real estate companies.

Corruption and poor data management have caused problems to millions of Ghanaian farmers for years.

Land ownership issues have limited external investments to the country’s agricultural sector.

Bitland Global, a US blockchain company, is launching a blockchain-powered land registry for use in Ghana’s agricultural sector.

The pilot project by the name Nagrovest will take the following steps to streamline Ghana’s land registry.

  • Investigations on the existing title.
  • Survey of the land.
  • Confirmation of the issued title certificates.
  • Recording of GPS coordinates.
  • Submission of collected data to a blockchain ledger.
  • Issuing of both paper and digital land title.

The use of a decentralized land registry in Ghana will result in a quick way of settling land disputes.

Blockchain Projects Born in Africa


Over 60% of Africans are unbanked.

People living in rural villages find it hard to access banks located in cities and towns. This prompted innovation in the form of informal savings groups known in Kenya as Chamas.

These savings groups are however plagued with problems of fraud and misappropriation of funds.

Here comes ChamaPesa to the rescue.

ChamaPesa will make use of blockchain’s immutability to create a platform where these informal investment groups can record all transactions.

ChamaPesa is still in the development stages and is set to be launched in September 2019.

TMX Blockchain Logistics

Cross-border commodity movement in Africa is often costly and takes too long.

To the rescue is TMX global logistics

TMX global is a blockchain-powered global and hyperlocal logistics company. The Kenyan-based organization will use a decentralized protocol to help streamline Africa’s import and exports industry.

A blockchain-based platform will result in lower shipping fees, increased outreach for suppliers as well as solve inefficiencies that affect global and local logistics.

Crypto Exchanges in Africa

Cryptocurrencies and blockchain technology go hand in hand. Crypto wallets and exchanges have allowed the average Joe to buy and sell cryptocurrencies with ease.

However, international crypto exchanges often have regulations that limit Africans from joining the dynamic crypto economy.

How then do Africans buy and sell cryptocurrencies?

Crypto exchanges designed for the unique African market have come up. These crypto-exchanges accept African currencies and mobile money payments.


Launched in 2014, BitPesa is a Kenyan-based payment platform that uses blockchain technology to make international financial transactions cheaper, easier, and faster.

BitPesa is also a crypto exchange where customers in Kenya, Uganda, and Nigeria can buy Bitcoin.

Bitpesa also has operations in Ghana, Tanzania, Senegal, and the Democratic Republic of Congo.

Source: Bitpesa


CoinPesa is a Ugandan crypto exchange that launched in 2018. The exchange was formed with the aim of making cryptocurrencies available to the average citizen.

Ugandans can use the exchange to buy Bitcoin, Bitcoin Cash, and Ethereum.

Source: Coinpesa


NairaEx is Nigeria’s oldest and most popular Bitcoin exchange.

The crypto trading platform only deals with Bitcoin and does not offer any altcoins. Users deposit Nigerian Nairas in exchange for Bitcoins.

NairaEx also provides a payment platform for its 100,000 customers.

Source: NairaEX


Golix is Zimbabwe’s oldest crypto exchange wallet.

Founded in 2015, Golix grew to become the biggest crypto exchange in Zimbabwe. In 2017, Golix had over 50,000 customers.

However, government interference has resulted in a decrease in its Zimbabwean client base.

Golix also has operations in Kenya, Uganda, and South Africa, and hopes to expand to other parts of Africa.

Source: Golix


BitFund is among the few African crypto exchanges that allow users to invest in any of the top 20 cryptocurrencies.

The South African-Based platform was launched in July 2018 and boasts of providing a simplified and secure way for South Africans to buy and sell digital currencies.

Source: Bitfund

PesaMill Africa

PesaMill Africa is the newest digital assets trading platform in Africa.

Launched in 2018, the Kenyan-based exchange platform plans to have operations in all African countries.

Unlike international crypto exchanges where verification takes too long, the PesaMill verification process takes less than 5 minutes, making it easy for any African to join the dynamic crypto economy.

PesaMill has also incorporated Anti-Money Laundering and Know Your Customer features to protect its users while assuring regulators that money flowing through their platform is not used for illegal activities.


Ice3X is one of Africa’s oldest and most established crypto exchanges.

The South-African based trading platform was formed in 2013 and has operations all around the continent.

Platform users can exchange either the South African Rand or the Nigerian Naira for Bitcoin, Litecoin, and Ethereum.

What is the State of Crypto Regulation in Africa?

African governments have taken varied approaches to cryptocurrencies and blockchain.

Some governments have issued regulations to govern the crypto market, while there are those that have completely banned cryptocurrency use and trading.

South Africa

South Africa is among the few African nations that have shown a positive attitude towards cryptocurrencies.

In 2018, the South Africa legislature amended the taxation law to include cryptocurrencies. The amendment classified cryptocurrencies as financial services; thus, subject to VAT.

In January 2019, the South African government established a crypto-asset regulatory working group. This step aims at getting a clearer understanding of cryptocurrency and blockchain technology; thus, ensure data and not emotions inform regulations.


Zimbabwe has an interesting history with cryptocurrencies.

The failure of the Zimbabwean currency propagated many of its citizens to invest in cryptocurrencies. At one time, Golix, which is Zimbabwe’s biggest crypto trading platform, had over 50000 users.

Then government regulations hit.

In May 2018, an order issued by the Reserve Bank of Zimbabwe banned crypto use in the country and ordered Golix to close shop.

The courts however overturned this ban allowing Zimbabweans to once again trade in cryptocurrencies.


Kenyans are among top crypto users in Africa. Crypto regulation is however currently lacking.

Despite the lack of regulations, financial institutions have warned Kenyans to avoid investing in Bitcoin and other virtual currencies.

In May 2018, the Central Bank of Kenya warned Kenyans not to invest in Bitcoin. The Capital Markets Authority, which is a government agency that monitors market activities, has severally cautioned Kenyans against investing in Cryptocurrencies citing market volatility.

The Kenyan government has however expressed interest in blockchain technology. The Kenyan president formed a blockchain regulatory taskforce, whose main role is to provide recommendations on the adoption of blockchain technology.


In a continent characterized by long-standing institutional inefficiencies, inflated cross border transaction costs, high corruption, and inflation rates, blockchain technology has the potential to revolutionize the African society.

From smart contracts to enabling micropayments to supply chain management, blockchain will give birth to an era of transparency and efficiency; thus, allow Africa to catch up with the rest of the World.

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