It’s an interesting week for the cryptocurrency space in Africa this week. The continent has seen more governments profess their support for cryptocurrencies publicly, while others are planning to create a regulatory framework for the market.
Nigeria opposition leader promises to support blockchain, cryptos
Atiku Abubakar, the former Nigerian vice president and current opposition presidential candidate, promised his supporters that, when elected, he would work to create blockchain and cryptocurrency regulation for the country.
According to local reports, Abubakar made the announcement while launching his policy document ahead of the February 2019 elections. In the policy, he explains that he plans to use blockchain and cryptocurrencies to help improve the country’s economy.
In his policy document titled ‘Get Nigeria Working Again,’ Abubakar also explain that this government will, in addition, create a regulatory framework for the industry. He stated that regulation would help build the industry, in turn, creating thousands of employment opportunities as well as generating income for the government.
He asserted, “My mission is to make sure that Nigeria’s economy is reactive to the challenges of the 21st-century knowledge economy by keeping up with the amazingly dynamic in the technological pace.”
The crypto ecosystem in Nigeria has been on the rise in the last few years and the country is among the top crypto markets in Africa. If Abubakar gets elected as president, the crypto space in the country stands to see tremendous growth. Despite the current crypto prices and challenges, it seems that Abubakar is optimistic about the cryptocurrency industry.
Uganda has plans for new crypto regulations
The cryptocurrency market in Uganda has shown great promise ever since Binance set up shop in the country. Though not as active as South Africa, Nigeria or Kenya, the market is quickly picking up the pace. With this new development, the government in Uganda has decided to set up regulations to govern all crypto operations. According to reports, the government seeks to establish rules that will protect its citizens from illegal activities in the space.
Thousands of Ugandans have fallen victim to one crypto scam or another and many have lost vast sums of money in the process, local news outlets reported. The government fears the economy in the country might become unstable if this trend continues.
According to David Bahati from the Planning and Finance Ministry, his ministry has finished drafting the bill that pertains to national payments. The bill will be presented before Parliament next month for debate and approval. The bill has already been approved by the Cabinet in Uganda and is believed to shine a light on what citizens can do when they find themselves victims to fraudulent activities in the crypto space.
South Africa seeks to regulate crypto through taxation.
In April 2018, the South African Reserve Bank stated that cryptocurrency is not considered “legal tender” in South Africa. Later, authorities in the country imposed tax regulations on crypto owners that require them to declare their gains and losses concerning their transactions involving cryptocurrency.
In July, the National Treasury published the draft Taxation Laws Amendment Bill (the Bill) for the public, the Treasury’s first attempt to regulate the use of cryptocurrency in the country. It proposes changes to both the Income Tax Act and the VAT Act. One of the proposed changes is the inclusion of cryptocurrency in the definition of “financial instrument” in the Income Tax Act.
Experts claim that the new bill will not be favourable for the crypto space in the country. According to the reports, Section 22 and section 22(1)(a) of the Income Tax Act limits the benefits crypto traders get from valuing their undisputed cryptocurrency using the valuation method contemplated in section 22. In addition, Section 11 also represses investment in FinTech companies in South Africa.
The Treasury has also suggested that the “issue, acquisition, collection, buying or selling or transfer of ownership of any cryptocurrency” be added to the definition of “financial services” in Section 2 of the VAT Act.
While some countries seem to be content with not innovating in the crypto space, it is becoming more apparent that African nations see the true value of digital currency in global economies.
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Sompo, a Japanese insurance company, has partnered with BitPesa, a pan-African digital payment platform, as part of its bid to increase the company’s global presence.
In a statement posted last November 9, Sompo said its partnership with BitPesa is focused on the “digitalization of global remittance services,” noting: “Using BitPesa’s technology, developed through various experiments in remittances and settlements, we will extend our presence in the international remittance service market and consider the application of this technology to the insurance field.”
The partnership will see Sompo utilize BitPesa’s crypto-enabled fiat remittance services to help the Japanese insurer lower the costs and time it takes for transfer of value around the world.
The news comes weeks after another Japanese player, SBI Remit, teamed up with the pan-African blockchain company to bring distributed ledger to transactions between the two regions. According to Cointelegraph Japan, Sompo Holdings has reportedly invested JPY570 million ($5 million) last week for a 10% stake in BitPesa.
Using BitPesa’s international remittance services, Sompo can extend its existing network to reach a broader customer base. BitPesa, also known as BTC Africa, was launched in 2013. Since its launch, BitPesa has made quite a name for itself, focusing on bringing transparency and liquidity to the African continent with cryptocurrency. The firm has rapidly grown its business by helping small and medium-sized enterprises through international partnerships.
BitPesa has secured venture capital funding from VC firms like Draper VC, Digital Currency Group, and Pantera Capital. The agency has used the funding to develop a global remittance network with BTC as a base currency to improve financial infrastructure involving the growing world, Europe, and the United Kingdom.
The two Japanese financial services companies will help BitPesa to expand its international remittance service. The two agreements with SBI Remit and Sompo Holdings should help customers move money between Japan and African countries without third parties. BitPesa simplifies the process by using blockchain to create new currency pairs between Japanese yen and the fiat currencies of Kenya, Morocco, Ghana, Senegal, Uganda, the Democratic Republic of Congo and Tanzania.
Note: Tokens on the Bitcoin Core (segwit) Chain are Referred to as BTC coins. Bitcoin Cash (BCH) is today the only Bitcoin implementation that follows Satoshi Nakamoto’s original whitepaper for Peer to Peer Electronic Cash. Bitcoin BCH is the only major public blockchain that maintains the original vision for Bitcoin as fast, frictionless, electronic cash.
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Quidax, a European-based cryptocurrency exchange, recently launched its operations in Nigeria. Among its new objectives is a plan to educate and increase the level of understanding on blockchains and its technologies in the country.
While speaking at the Abuja Blockchain and Artificial Intelligence Roundtable (ABAR), Buchi Okoro, chief executive officer of Quidax, urged investors to take advantage offered by the emergence of cryptocurrency to grow their businesses and Nigeria’s economy. He also explained the importance of understanding this new technology and termed it as the “future currency.”
Okoro stated that the company was created to enable people to buy and sell cryptocurrencies easily with local currencies. He added that the goal of Quidax is to provide liquidity and tools to power cross-border remittances in the emerging markets.
Quidax will partner with the organizers of Abuja Blockchain and Artificial Intelligence Roundtable in their quest to enlighten Nigerians on blockchain and cryptocurrencies, according to the CEO. It will also continue to seek and develop new partnerships that will help fulfill their mission.
During the presentation, Quidax’s boss added that there is a need for regulations in the cryptocurrency space in Africa. Okoro further said that the industry had been underutilized because there was a lot of ignorance among the public.
The company mentioned that, to help with their agenda, they have created a platform that is easy and secure. The platform will allow Nigerians to trade six cryptocurrencies, but didn’t specify which six. The company plans to add more than 20 cryptocurrencies in the coming future.
In addition to educating the public, the company also plans to create employment opportunities for the unemployed population in Nigeria.
African exchanges forced to upgrade security systems
Criminal activities targeting crypto exchanges have been on the rise in the last couple of years. This has forced exchanges in the continent to take measures. According to recent reports, crypto exchanges have been forced to increase their security measures to avoid losing customer money to scammers and hackers.
Records show that the region has lost millions of dollars to criminals in the cryptocurrency space. The most notable crypto crime in Africa happened in March 2018. The incident involved a fraudster at BTC Global, a supposed cryptocurrency investment firm in South Africa. The scam involved 28,000 unsuspecting South African inventors. It is believed that the criminals made off with about 1 billion rand ($80 million). Investors were lured with promises of huge returns within a short period of time.
The decision to safeguard investors’ money will help reduces fraudulent activities in the continent. This move will help protect the growing cryptocurrency markets and build confidence of those who still have doubts about cryptocurrencies.
While speaking to reporters, Suleiman Murunga, the CEO of Ugandan exchange Coinpesa, said his exchange has faced numerous attempts to breach their system. He explained, however, that unlike most exchanges, Coinpesa’s security system has been able to withstand all these attacks.
Murunga added that to maintain a secure platform they are constantly using tools to track user behavior in order to spot suspicious activities. Coinpesa and other cryptocurrency exchanges have also stopped storing investor funds in hot wallets to reduce hacking attacks.
According to reports, when a breach occurs, exchanges are not always to be blamed. In some cases, breaches occur due to ignorance and negligence on the part of investors. For instance, before Zimbabwean exchange Golix closed down, hackers were able to gain access to 23 customer accounts by taking advantage of vulnerable passwords. No money was stolen in the attack; however, account owners noticed some changes on their account.
Nigeria has also suffered significant cyber attacks. A hacking group from Ukraine allegedly committed one notable attack that led to the loss of $50 million. Local scammers pretending to offer various crypto services have also become a major problem in the country.
Exchanges hope upgrading security features will help solve some of these problems.
Note: Tokens on the Bitcoin Core (segwit) Chain are Referred to as BTC coins. Bitcoin Cash (BCH) is today the only Bitcoin implementation that follows Satoshi Nakamoto’s original whitepaper for Peer to Peer Electronic Cash. Bitcoin BCH is the only major public blockchain that maintains the original vision for Bitcoin as fast, frictionless, electronic cash.
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The Bank of Zambia (BoZ) is finally making a stand on the increasingly popular activity of cryptocurrency trading—cryptocurrencies are not legal tender in the country.
In a statement, the central bank of Zambia said it has received an increasing number of inquiries about cryptocurrency-related activities in Zambia, specifically trading in the crypto coins.
BoZ, however, noted that despite having “some monetary characteristics,” cryptocurrencies are not legal tender in Zambia.
“Section 30 of the Bank of Zambia Act vests the right to issue notes and coins exclusively in the BoZ. To date, BoZ has not issued any form of cryptocurrency. Cryptocurrencies are not legal tender in the Republic of Zambia,” according to the central bank.
And since the bank has yet to regulate the cryptocurrency landscape, investors taking part in the crypto trade are doing so at their own risk. BoZ urged investors to be very careful while trading in crypto to avoid losing their funds to possible scammers and illegal traders in the cryptocurrency market.
“Some of [the] risks include money laundering, financing activities of terrorism and general consumer protection risks such as fraud and hacking, to which in most cases, no legal recourse would be available to customers due to the unregulated nature of cryptocurrency-related transactions,” BoZ stated.
The central bank, however, isn’t closing its doors on the cryptocurrency sector. According to BoZ, it “will continue to actively monitor all developments” in line with its “position that regulation should not constrain but enable innovation.”
Lawmakers in the African country are reportedly seeking to create a legal framework that will allow the crypto market in Zambia to grow. Currently, the country does not make much contribution to the global cryptocurrency market. Also, Zambia does not have a local cryptocurrency exchange forcing local crypto trades to rely on foreign exchanges through peer-to-peer transactions.
Note: Tokens on the Bitcoin Core (segwit) Chain are Referred to as BTC coins. Bitcoin Cash (BCH) is today the only Bitcoin implementation that follows Satoshi Nakamoto’s original whitepaper for Peer to Peer Electronic Cash. Bitcoin BCH is the only major public blockchain that maintains the original vision for Bitcoin as fast, frictionless, electronic cash.
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CoinGeek’s Becky Liggero speaks to Riad Hartani of Xona Partners, who looks at how blockchain technology will impact markets across the world.
Even at such an early point in the history of blockchain, its real-world applicability is already being put to test by companies big and small. Yet to Riad Hartani, co-founder of tech firm Xona Partners, the potential for the technology’s mass adoption is particularly strong in Africa.
One present problem he sees is fundraising for small and medium enterprises. According to Hartani, “The whole process of raising money is very cumbersome, and basically difficult to put into practice. So this is a typical example, and with blockchain, you come up with a solution that facilitates all of that… Even if it’s a North American-developed technology, any advanced technology, teams and so on, but the first applications are in Africa, which is interesting.”
Xona Partners, according to Hartani, does three things to push blockchain technology: “We see blockchain as what we call a ‘leapfrog’ technology that just comes into markets and [is] given the opportunity to disrupt, basically. Solve problems definitely, one. Number two, since it’s new, basically the whole world’s probably at the same levels. You can take it, build it, and then go global with it. And number three, it’s mostly open-source, so the knowledge is very much accessible if you have talent. You can have access to it without any restrictions. So these three things make it very valuable for Africa and building technology ecosystems in Africa, in our opinion.”
Hartani sees the Transform Africa summit as part of the necessary gatherings among people that will make the technology thrive. “I see overall the value is really building this connectivity between people and ideas, and this is ideal. Because what is technology these days? Basically being able to be close to those that understand it and have it, right? So building that connectivity model between people and ideas is really the goal, and I think this event has been doing a lot of that. And meeting people from any part of the world that have that knowledge and keys to be able to work with them. So fundamentally, I see it as a way to basically get us closer to that, you know, ‘world is flat’ thing. We all work with each other,” he said.
If you’re interested in helping the growth of merchant adoption of Bitcoin BCH, join the bComm Association, an industry group that intends to be the focal point for miners, merchants, exchanges, developers and members of the BCH community. Developers and merchants of the Bitcoin BCH community will also be on hand for the first CoinGeek Week Conference happening in London on November 28-30. Members of bComm Association can avail CoinGeek Week tickets at discounted prices. Tickets to the three-day conference are still available via Eventbrite.
Note: Tokens on the Bitcoin Core (segwit) Chain are Referred to as BTC coins. Bitcoin Cash (BCH) is today the only Bitcoin implementation that follows Satoshi Nakamoto’s original whitepaper for Peer to Peer Electronic Cash. Bitcoin BCH is the only major public blockchain that maintains the original vision for Bitcoin as fast, frictionless, electronic cash.
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Paxful, a peer-to-peer marketplace, is reportedly looking at the cryptocurrency market’s growth potential in East Africa. The startup has already set up shop in Rwanda, ventured into Kenya, and has grown over the last three years into a global peer-to-peer crypto marketplace. It reportedly handles $15 million in crypto transactions, BTC in particular, per week from across the world. This rapid expansion has solidified its place among major reputable crypto players and offers enhancements in both security and efficiency.
Paxful has over 1 million active monthly users from around the world. This is because it has partnered with popular payment platforms such as PayPal, Western Union, Amazon Gift Cards and iTunes Gift cards.
Paxful’s entry into the East African scene is at a time when crypto penetration in Africa is at an all-time high. According to recent studies, one in three Kenyans owns a crypto wallet. Additionally, Kenya’s M-PESA system, a mobile phone-based money transfer and micro-financing service, recently announced the launch of its own crypto device. This will make it convenient for Kenyans to buy and sell cryptos on peer-to-peer marketplaces.
A tokenization drive has been initiated in Rwanda to help steer the crypto market. It has helped connect buyers and sellers to easily trade cryptocurrencies like BTC. This has been aided by the fact that the platform has no buyer fee and a minimal 1% seller fee in online shopping, which has attracted the attention of many online shoppers.
In Rwanda, Paxful is engaged in a project called #BuiltWithBitcoin in conjunction with the non-profit organization Zam Zam Water. The project aims to a school for 6- to 15-year-olds. Previously, the charity initiative funded launched a school in Bugesera in the Nyamata Sector for 3- to 6-year-olds. The aim is to promote charity within the crypto community and to improve and change lives for a better world, according to Paxful CEO Ray Youssef.
The developments in Rwanda and Kenya reflect the growing demand for investing in crypto in East Africa. In Kenya, for instance, more and more people are becoming more confident in dealing with cryptocurrency despite it being new and coming with a learning curve. Most people have come to accept its plethora of benefits. It offers massive wealth distribution globally as well, and presents financial freedom to individuals.
Crypto ventures have the potential to be the initiator of many emerging fundamentals of economic growth in the East African region if the right balance is found.
Note: Tokens on the Bitcoin Core (segwit) Chain are Referred to as BTC coins. Bitcoin Cash (BCH) is today the only Bitcoin implementation that follows Satoshi Nakamoto’s original whitepaper for Peer to Peer Electronic Cash. Bitcoin BCH is the only major public blockchain that maintains the original vision for Bitcoin as fast, frictionless, electronic cash.
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Venture-backed firm BitPesa has partnered with Japan’s remittance service provider SBI Remit to bring cross-border blockchain payments to Africa.
On Monday, CCN reported that the partnership will see the two companies utilizing blockchain technology to make it easier for Africans to buy Japanese products. With the help of blockchain, the companies expect to get rid of challenges accompanying the transfer of funds between African traders and Japanese exporters, resulting in traders enjoying faster cross-border payment transfers with improved efficiency and more stringent security.
The partnership will focus on a number of industries, including used cars, electronics and cosmetics. This is expected to foster strong business ties between Japan and Africa. The partnership will especially benefit the used cars industry—the leading business between the two continents.
According to BitPesa founder and CEO Elizabeth Rossiello, traders stand to gain a lot from this partnership since “they don’t need to do any conversion.” Traders will be able to deposit funds directly to BitPesa’s accounts in their local currencies. Once the funds have been deposited, BitPesa will disperse the funds to their Japanese counterparts at SBI Remit, who will proceed to pay clients.
From this partnership, traders will enjoy easy transfer of funds, lower fees, and they will also not have to deal with currency conversion. Moreover, through the BitPesa and SBI partnership, transactions will be much faster than the two-week duration given to by local banks. It will also reduce the volatility risk that comes with forex conversations.
Enabling cross-border payments will also help open up business between Africa and Japan. The latter will be able to tap directly into BitPesa’s digital exchange platform, which has a presence in Democratic Republic of Congo, Senegal, Uganda, Tanzania, Nigeria, and Kenya. Traders from these countries will now be able to pay for goods from Japan easily.
Asian traders have been finding it hard to launch businesses in Africa due to fund transfer bottlenecks. Transferring funds from local currencies to a G20 currency has not only been time consuming but also expensive. Similarly, even transfer of funds locally within African countries requires the local currency to be converted to a G20 currency to facilitate this transfer.
With the BitPesa platform, Rossiello said the transfers can be done on their platform and would be more affordable and cost effective than conventional approaches. Both companies are optimistic about working together to grow business in Africa and Japan.
Note: Tokens on the Bitcoin Core (segwit) Chain are Referred to as BTC coins. Bitcoin Cash (BCH) is today the only Bitcoin implementation that follows Satoshi Nakamoto’s original whitepaper for Peer to Peer Electronic Cash. Bitcoin BCH is the only major public blockchain that maintains the original vision for Bitcoin as fast, frictionless, electronic cash.
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CoinGeek’s Becky Liggero caught up with Dr. Craig Wright, chief scientist of nChain, to discuss what Bitcoin Cash (BCH) can bring to developing countries around the world.
For nChain’s chief scientist Dr. Craig Wright, the use of Bitcoin Cash (BCH) as means of payment in Africa should not be confined to within the continent. The potential of a universally accepted currency making instant transactions possible should be explored farther.
“I think trade globally is what matters. Trade forms markets because of an emergent property in markets, all those people interacting without regulations stopping them,” he said.
Goods in one country in Africa are often available elsewhere in region, where trade opportunities are not maximized. “There’s coffee beans in Rwanda, there’s coffee beans in Ethiopia, there’s coffee beans in Kenya. Do you think Rwandans are going to buy Kenyan coffee beans and swap their coffee beans for the other? So what we need is a world market. Right now, that is a very primary market, one where people haven’t opened up and developed. That can be services and other things as it develops more and it can be global. With the internet, with the ability to trade from here to America, from here to Europe, that brings money in and can be used to further develop the country, to build infrastructure,” he said.
Bitcoin BCH might eventually serve as a medium of exchange to a greater capacity than the U.S. dollar and other fiat currencies.
“Bitcoin Cash, first of all, enables a payment system. So that’s going to open up the markets, the ability to trade, not just locally, which is part of it. Within the regions, but [also] globally. A global money becomes trusted because you know it’s liquid everywhere. But we can take that further. With the introduction of smart contracts, we can do things like enabling people to invest here in maybe even coffee plantations, maybe other forms of agriculture, maybe growing plantains that not get sold locally but become sold everywhere so that you can then get more money back and buy more goods and services, maybe educate your children and develop a future,” he said.
Because of BCH’s great exchangeability, the products for which BCH serves as remuneration ought to be something usable on a global scale. “I think the real issue is actually creating something that is going to be globally distributed. We don’t want to localize. This is the whole point of specialization. What are you building here? And there are some new industries that are starting to pop up, and that’s what they need to focus on, whether it’s developing new technology, whether it’s having the agriculture in a way that [you] can sell to the world, whatever else. But to do that, you’re not looking at selling between Africans. You want to sell to the world, you want to sell to Europe, you want to sell to Asia, you want to sell to America. That’s when it really becomes powerful. And having Bitcoin Cash will help and enable that,” Wright said.
If you’re interested in helping the growth of merchant adoption of Bitcoin BCH, join the bComm Association, an industry group that intends to be the focal point for miners, merchants, exchanges, developers and members of the BCH community. Developers and merchants of the Bitcoin BCH community will also be on hand for the first CoinGeek Week happening in London in November. Members of bComm Association can avail CoinGeek Week tickets at discounted prices. To purchase tickets or learn more about CoinGeek Week Conference, visit the official website here.
Note: Tokens on the Bitcoin Core (segwit) Chain are Referred to as BTC coins. Bitcoin Cash (BCH) is today the only Bitcoin implementation that follows Satoshi Nakamoto’s original whitepaper for Peer to Peer Electronic Cash. Bitcoin BCH is the only major public blockchain that maintains the original vision for Bitcoin as fast, frictionless, electronic cash.
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