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South Africa and the Crypto-economy

We are officially in a global revolution but one whose subject is not related to politics or military might but one that is premised on digital currency. No doubt, cryptocurrency has come to stay and Africa is not left behind in this revolution as investments in cryptocurrencies have been growing steadily in the continent. South Africa is one of the major African countries to have latched up to the cryptocurrency trend. Cryptocurrencies such as Bitcoin, Litecoin, Dash, Tether, Ripple, Dogecoin, and others are gaining traction in the country.  

Bitcoin ATM

South Africa’s readiness for a full-blown takeover of cryptocurrency is clearly demonstrated by the availability of Bitcoin ATMs scattered across different states in the country. There are 7 Bitcoin ATM installations in the country; 4 of these ATM installations are located in Cape Town which is most likely due to its status as the most populous South African city. There is also 1 Bitcoin installation each in Durban, Johannesburg, and Pretoria. The continued success of these ATM installations expectedly will enhance the spread of Bitcoin in other parts of the country. Purchasing Bitcoin is quite easy in South Africa. You can create an account with Luno, a cryptocurrency exchanger, and deposit fiat after which you can convert your deposit into Bitcoin. Apart from Luno, there are quite a number of other exchanges that offer the sale and conversion of Bitcoin.   

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Where can you spend Bitcoin?

Bitcoin can be used to purchase a host of products or services in South Africa. In fact, bitcoin payments in South Africa have been gaining traction in recent times. Bitcoin can be used for payment at Aphrodata which is an IT service company. Cryptocurrency may also be used for purchase at Baseline Skate Shop and if you are interested in buying gift cards with Bitcoin then you may head to Bitrefill. Bidorbuy.co.za is an online marketplace that affords buyers and sellers a meet place to buy and sell with Bitcoin as an acceptable means of payment. Zasstra is a seller of PC accessories, phone accessories, and electronic gadgets who also accepts Bitcoin as a method of payment. The Sun Exchange is a seller of solar energy cells, their products can be purchased with Bitcoin as well. The business outlets and vendors accepting the use of Bitcoin are quite extensive and with time the list will potentially get even longer.   

Nigeria’s Loss South Africa’s Gain

The recent ban on cryptocurrency transactions in Nigeria is a move that will potentially generate pleasant returns for South Africa. Nigeria and South Africa are some of Africa’s largest economies with attractions for prospective investors, since Nigeria has chosen a more conservative approach to the use of crypto’s then South Africa stands to gain from such ill-timed policy from the Nigerian government. Essentially South Africa’s receptive approach to cryptocurrencies may see erstwhile investors in cryptocurrencies from Nigeria transacting their business with companies domiciled in the nation, a move that will boost the nation’s economy.    

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Governmental Regulations

Initially, the South African government adopted a bystander approach to the operations of digital currencies in the country as there are no laws promoting or prohibiting their usage in the country. However, in 2020 they took the first steps towards regulating the use of cryptocurrencies in the nation. South Africa’s Financial Sector Conduct Authority (FSCA) last year proposed a new regulations policy that will recognize crypto assets as a financial product under the Financial Advisory and Intermediary Services Act (FAIS). 

This new policy regulation will also pertain to cryptocurrency service providers, as well as brokers, advisors, and crypto exchanges operating in the country as they would now be required to register with the FSCA as financial services providers (FSPs). This move may potentially set the tone for other sets of policies that will see the government gain control over the use of cryptocurrency in South Africa. This could also indicate acceptance on the path of governments who have accepted their helplessness as regards the use of cryptocurrency but are interested in controlling its use. 

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The sizable population of young people in Africa makes the continent a fertile ground for cryptocurrency’s growth. The trade-in cryptocurrencies such as Bitcoin and ethereum has taken up the status of investment opportunities engaged in to generate residual wealth. Great inroads have been recorded but there are even more grounds to be covered and with South Africa’s receptive approach to cryptos, it is only a matter of time before other countries buy into the cryptocurrency revolution. It may just be a matter of time before we start witnessing government-issued cryptocurrencies in Africa just as evident in other parts of the world. 

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