Despite the fact that Sub-Saharan Africa has the fewest cryptocurrency transactions of any location, the continent is home to some of the most mature cryptocurrency ecosystems, according to the most current research from Chainalysis.
According to the research, retail transfers account for 95% of all transactions in the area. “P2P exchanges account for 6% of total bitcoin transaction volume in Africa, more than twice the percentage of the next-closest area, Central & Southern Asia and Oceania,” the report said.
The CEO of Paxful, Ray Youssef, also mentioned how rules impact bitcoin activity and increase P2P adoption.
In the research, the analyst said, “Nigeria prohibited the use of the naira for purchasing cryptocurrency in 2021 owing to worries about scams and tax fraud, and as a result, many individuals started peer-to-peer trading.”
After the Reserve Bank of India maintained a negative attitude on crypto usage, banning institutional banks from providing services to the cryptocurrency market, India also observed a rise in P2P trading.
India slipped from the second-largest crypto-loving population to the fourth-largest crypto-loving population year-over-year, according to second research by the analytics company.
Recently, the South African Reserve Bank issued rules for local banks to do business with cryptocurrencies and cryptocurrency firms.
Previously, the analytics company had stated that Nigeria and Kenya, both of which rank in the top 20 of the Global Crypto Adoption Index, had a significant presence in the P2P sector.
Adedeji Owonibi, the creator of the Nigerian blockchain company Convexity, told Chainalysis, “We observe a large number of everyday traders that trade to make ends meet.”
He said that the volatility of the Nigerian naira also adds to the nation’s thirst for cryptocurrencies. The naira’s value versus the U.S. dollar has been declining as the Nigerian banking system’s foreign exchange reserves have diminished.
Notably, the analysis shows that crypto use this year is driven by everyday needs as opposed to speculation by the rich, adding, “The number of small retail transactions has actually increased since the bear market began in May, while the number of transfers of larger sizes has decreased.”
In spite of this, Sub-Saharan Africa’s dependence on foreign remittances and growing trade is driving commercial and other crypto use cases.
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