Why is Africa Slow on the Bitcoin Uptake?
Bitcoin could solve a lot of Africa’s problems, but its uptake has been slow.
There are masses of potential for Bitcoin in Africa. It’s a monetary system for the unbanked, it’s trustless and far less corruptible, and it can create a new monetary system where there’s no long legacy of banking and financials.
However, across the continent, in different countries, the uptake has been surprisingly slow. From South Africa and Nigeria, as the biggest players in Bitcoin, to smaller nations like Tanzania who are seeing big growth, but with small numbers.
Education and industry
Perhaps one of the biggest issues facing Bitcoin adoption in Africa is educating people about digital currencies. Bitcoin and the cryptocurrency world is still a foggy minefield for those who are actively using it, so it’s difficult to try and educate a whole continent
Africa is largely a cash-based infrastructure with a simplistic model, even banking is still a novel concept to a large portion of the population.
However, there’s also not much alternative, if understanding and education in digital currencies is low, their adoption in industry and retail is even lower.
Chad Robertson, co-founder and chief executive officer of South African startup Regenize, says awareness will help:
“Specifically, in South Africa, we have such a huge gap that keeps on growing regarding wealth, but also knowledge, on the ever-changing tech landscape. If I’m sitting in a coffee shop in the CBD, it’s quite likely someone will know what Bitcoin is. However, head down to the Cape Flats or townships (slums), and it’s highly unlikely that there’ll be many people who are aware of this.”
But again, Robertson brings it back to industry. Those who will accept Bitcoin in Africa are even rarer than those in the rural areas that have heard about it.
“However, this lack of education and awareness could be drilled down further on to find the root cause. There are too many people living in poverty in South Africa and Africa. They simply cannot think about using Bitcoin, as it’s not relevant to their needs. The local spaza shop (corner shop) does not accept Bitcoin, so how will someone get their bread or milk? Schools don’t accept it for school fees. You cannot buy electricity with Bitcoin to keep your lights on. So why would they care or want to be educated on it?”
Of course, Africa is a diverse place, and one that has a huge gap between rich and poor. So while those near the bottom of the economic rung may not have heard of Bitcoin, or see any place to use it, those near the top have other issues.
Security concerns also need to be addressed before mass adoption, which also links back to education. Robertson said:
“There are many people who’ve been scammed on the Internet, especially those who are digitally uneducated. Therefore, there’s a fear and a stigma around using the Internet as a place to transact.”
Visibility is also an issue, with the majority of Africans used to having a brick and mortar institution available for their enquiries.
“With Bitcoin, there’s no visible place to lay a complaint or an enquiry. I would think change management would play a large role in the transition from using a bank. For generations, people have given their money to the bank and there’s a trust, as the bank is a brick and mortar institution. With Bitcoin, people might have fears of what happens to my money? Who do I complain to?”