Vibra, an African crypto and Web3 startup, is following the path of other similar companies like Lazerpay, Bundle, and Pillow, all of which have ceased their operations.

This crypto trading app has reportedly halted its services in Ghana, Kenya, and Nigeria. While the co-founder claimed it only affected Nigerian users and was a temporary measure, reports from Techcabal, quoting both current and former employees, confirm the app's discontinuation across all African markets. Some employees, who chose to remain anonymous, stated they were given the option to resign or face termination.

Vibra, initially founded in 2021 as a trading platform for African users, secured a $6 million presale strategic fund. The platform offered various features, including cryptocurrency trading. Despite its popularity, the company faced multiple challenges, particularly in generating revenue, partly due to the challenging startup environment in Africa, which hindered monetization efforts.

Bear Market Effect

Recent reports indicate that numerous startups have been closing their operations in this period. Many of these crypto startups, despite having raised substantial amounts of funding, have primarily succumbed to the challenging market conditions.

One notable example is Dash, a Ghanaian startup that managed to secure $86 million in capital fundraising but couldn't sustain its business over five years.

Lazerpay, another Nigeria based crypto payment company, was shut down earlier this year (April 2023) too. The shutdown came after the startup’s founder, Njoku Emmanuel, shared that the company was having trouble raising money. He mentioned that the company has been struggling to stay afloat after failing to secure funding. In November 2022, the lazerpay workforce was downsized .

Pillow, a cryptocurrency management application, recently announced its decision to cease its activities in Nigeria as of July 31, 2023. The reason behind this move is the uncertainty surrounding regulations in the country, and how these regulations have been affecting the associated financial infrastructure. It's important to note that Pillow boasts a diverse user base, with more than 75,000 members spanning across 60 different countries.

LocalBitcoins, a well-known crypto exchange with a focus on the African market, closed its doors in February 2023 after a decade of operation. This platform, which was among the earliest and most popular peer-to-peer crypto exchanges, bid farewell to its users.

In a similar vein, Bundle Africa made the decision to discontinue its services in July 2023. Interestingly, their decision was driven by a desire to shift their focus towards their peer-to-peer product, Cashlink. Notably, Bundle Africa did not attribute its closure to regulatory challenges or market downturns.

The impact of a bear market is a noteworthy worry for investors, yet it constitutes an inherent component of financial markets. Grasping the origins and consequences of a bear market is imperative for investors to make well-informed choices.

Bear markets typically arise from a blend of economic, financial, and psychological elements. Some common causes encompass:

1. Economic Downturn: A weakening economy can lead to a bear market, marked by factors like rising unemployment, declining industrial production, and decreased consumer expenditure, all contributing to a negative economic outlook.

2. High Valuations: Overvalued stocks or other assets can prompt a correction, leading to a bear market, as prices need to realign with more reasonable levels.

3. Interest Rates: Elevated interest rates amplify borrowing costs and diminish corporate profits. Investors may also shift their preference towards fixed-income investments, diverting funds from stocks.

4. Geopolitical Events: Political instability, conflicts, or significant global occurrences can rattle investor confidence, inciting a bear market.

5. Speculation and Sentiment: Negative investor sentiment and fear can become self-fulfilling prophecies, inducing selling and subsequent price declines.

6. Technological Disruption: Disruptive technologies can disrupt entire industries, triggering a downturn in specific sectors and culminating in a bear market.

The ramifications of the bear market effect are far-reaching and encompass various aspects of the economy and society; it's leading to the following:

1. Wealth Erosion: The most apparent consequence is a substantial reduction in investors' wealth. Their investment portfolios, retirement funds, and other assets dwindle in value, causing emotional and financial distress.

2. Reduced Consumer Spending: As individuals witness their wealth diminish, they tend to curtail their spending, potentially leading to an economic contraction.

3. Job Losses: To offset dwindling revenues, companies may cut expenses, including reducing their workforce, resulting in job losses.

4. Credit Tightening: During bear markets, banks and financial institutions may exercise caution in lending, leading to credit constraints and reduced economic activity.

5. Retirement Concerns: Many people depend on investments for retirement income, making bear markets a threat to retirement plans and prompting individuals to reconsider their strategies.

6. Government Policy Response: Governments may implement fiscal and monetary policies to counter the bear market effect, including stimulus packages, interest rate adjustments, and regulatory modifications.

7. Investor Sentiment: Prolonged bear markets can significantly influence investor sentiment, making people more risk-averse and affecting their investment choices in the long term.

In conclusion, the bear market effect is a considerable concern for investors, yet it is an important part of financial markets. While navigating bear markets can be challenging, they can also offer opportunities to those who are well-prepared and patient. Diversification, careful planning, and a long-term perspective are key in managing the bear market effect and securing one's financial future.

Source:

https://web3africa.news/2023/10/21/crypto/ranking-the-top-10-crypto-market-cap/amp/