Digital currencies have come a long way in Africa and are now widely accepted. Despite a number of high-profile breaches of trust and general turbulence in the digital asset market in 2022, the adoption of cryptocurrencies across the continent remained steady. Additionally, there has been a shift in the reliance on conventional payment methods, leading young Africans to favor innovative payment platforms over established ones.

Africa, the second-most populous continent in the world with over 1.5 billion inhabitants, boasts a truly diverse and developing economy. According to Chainalysis, Kenya, Nigeria, South Africa, and Tanzania had among the highest rates of cryptocurrency adoption worldwide, ranking in the top 20 of the global adoption index. As Web3 real use cases continue to grow, it is critical to comprehend the factors that have fueled this expansion.

Here are a few things to remember.

▪️Payments Remittance

With billions of cash shifting hands annually, remittances are a significant contributor to the global economy. Remittances account for 1.3 percent of GDP in Africa, and through 2025, they are predicted to increase at a 5.2% annual pace. Approximately half of the 400 million migratory workers in Africa, according to World Bank estimates, reside outside of their nation of origin.

Remittances to African households total US$100 billion annually, which is more than they spend on healthcare and education put together!

It is widely known, meanwhile, that a number of African countries currently impose hefty fees and have a limit on the amount that can be sent. Because of the lowered fees and restrictions, the amount of remittance payments made using cryptocurrencies has been steadily rising, which has increased the rate of adoption of cryptocurrencies, as demonstrated by analysis.

Additionally, a recent study reveals that compared to other regions worldwide, cross-region transfers from Africa account for a larger portion of the cryptocurrency industry, with Sub-Saharan Africa anticipated to receive remittances worth over US$48 billion in 2019.

As the Web3 market grows, Binance is aware of how more and more people's everyday lives are being impacted by the blockchain and cryptocurrency worlds. For this reason, they are constantly adding new features and utilities to improve every element of their users' Web3 experiences.

For example, its recent product, Binance Pay – a contactless, borderless, and secure cryptocurrency payment technology, that ensures that users around the world can send and receive crypto across continents. Features such as this, provide increased accessibility of people’s own money whenever they need it and further highlight the user-centric character of digital assets.

▪️Devaluation of Fiat

The devaluation of several African currencies has been a persistent trend in recent decades, which has inevitably raised the value of the African cryptocurrency market. This is because stablecoins, or stable digital currencies, have allowed users to maintain their investments without worrying about inflation thanks to cryptocurrencies.

Because of this, Africans can trade bitcoins on Binance or exchange their local currencies for other stablecoins, making it one of the most well-known and popular platforms in the African cryptocurrency sector.

▪️International Trade

Cryptocurrencies have also grown to be a vital component of global trade as a result of their increasing acceptance in a variety of settings and nations. Before cryptocurrency, the cross-border payment bureaucracy was unquestionably a machine that prevented exchanges that could significantly benefit developing nations.

Moreover, there is the challenge of reaching global agreements using different currencies, a problem that is especially common in Africa. For nations with poor banking infrastructure, cryptocurrencies offer a game-changing alternative by simplifying international money transfers. Safety concerns are also eased in this case because crypto-based transactions lower the risk involved in international trade.

Even if it's still early, the evidence clearly shows that Africans are starting to adopt new technologies. Significant advancements are also being achieved in the field of regulation, and long-term growth can be ensured by a stable regulatory environment, which will bolster burgeoning industry trust and encourage additional support for innovation.

▪️Youth engagement and learning

According to the World Economic Forum, youth in Africa make up approximately 60% of the population, and by 2030, young Africans are predicted to make up 42% of all youth worldwide. Young people in Africa are keen to investigate new prospects for improving their standard of living and earning money.

Since many Africans under 25 are searching for the most innovative and respectable sectors to invest in, it is hard to divorce the rise of cryptocurrencies in Africa from the requirements and interests of this demographic. Regionalized bitcoin education initiatives, like the ones Binance provides, have also contributed to the growth of cryptocurrency usage in Africa by igniting interest and accelerating adoption.