According to a recent Chainalysis report, sub-Saharan Africa is thought to account for just 2% of global trading activity, but the region “contains some of the most well developed crypto It contains some of the most well-developed cryptocurrency markets of any region,” according to the report. In addition, Sub-Saharan Africa “is unique compared to other regions because of the sheer volume of retail markets and the use of P2P platforms.”
Sub-Saharan Africa’s “outsized use of P2P platforms”
According to a newreportfrom blockchain intelligence firm Chainalysis, the total crypto transaction volume of $106 billion in sub-Saharan Africa seen between July 2021 and June 2022 is less than any other region studied. While on-chain volume during this period is 16% higher than in the preceding period, Sub-Saharan Africa nevertheless reportedly accounts for only 2% of global crypto activity.
Still, Sub-Saharan Africa likely has the most developed cryptocurrency market globally, according to the findings of a blockchain analytics firm, Chainalysis’ report states
[Deeper analysis reveals that Africa has the most developed cryptocurrency market of any region, with deep penetration and integration of cryptocurrencies into everyday financial activities for many users.
To support these claims for the region, the report points to the structure of the region’s crypto markets and how they distinguish sub-Saharan Africa from other regions. The report explains that the retail market and “high usage of P2P platforms” are factors that distinguish the region from other parts of the global crypto market.
“Retail size transfers of less than $10,000 represent 6.4% of transaction volume, more than any other region. The role of retail becomes even more apparent when looking at the number of individual remittances. Retail remittances represent 95% of all remittances, and when narrowed to only small retail remittances under $1,000, the percentage rises to 80%, more than in any other region,” the report states.
Ongoing economic challenges drive the use of crypto
Meanwhile, a growing number of users in the region prefer to use peer-to-peer (P2P) exchanges. As noted in the report, P2P volume in the region alone is believed to “account for 6% of all cryptocurrency trading volume in Africa.”
With regard to the projected future use of crypto in sub-Saharan Africa, the report states.
“Overall, we expect the use of cryptocurrencies in sub-Saharan Africa to continue to grow as long as residents are faced with problems that crypto has proven capable of solving.”
“The use of cryptocurrencies in sub-Saharan Africa will continue to grow, for example, maintaining savings through economic volatility and enabling cross-border transactions in places with tight capital controls.
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