South Africa: The Next Frontier for Crypto Exchanges

Africa is set to be the next battleground for major crypto asset exchanges, as the conditions on the continent are favorable for virtual currency, and as a leading economy, South Africa could lead the charge in this digital transformation.

We will examine how the economic situation and the high inflation in Africa could shape the local crypto markets and why people on the second-most populous continent have been gaining an interest in crypto investments.

South Africa in particular seems ready to ride the waves and thrive in the crypto world.

According to the United Nations, the high-inflation landscape plus an improving economic situation have provided an ideal environment to foster crypto markets in Africa.

A weak currency leads to high crypto ownershipThe strength of a country's currency could add another dimension to the crypto development in Africa.

A recent Statista survey shows that South Africa, Turkey, Brazil, Colombia and Argentina were among the highest cryptocurrency ownership countries, with almost 20% of respondents reporting that they have used or owned crypto assets in 2019.Another similar study from We Are Social and Hootsuite also indicates that 10.7% of internet users in South Africa own cryptos - the highest ratio in the world.

South Africa's edgesSouth Africa is the second-largest economy in Africa after Nigeria, which has been enjoying faster growth in recent years.

In the past, South Africa has mainly been focused on the mining and agricultural sectors, but in recent years, the country advanced its economy by shifting its focus to tourism, financial services and the tech sector.

On the regulatory frontRegulatory issues have always been a major concern for crypto, digital asset exchanges and custody providers when it comes to expanding their businesses into new territory, and the regulatory landscape in South Africa - or broadly speaking, in Africa - could be a major factor that drives the crypto industry forward on the continent.

Africa has laid the foundations for the crypto industry to thrive on the continent, its high-inflation economy encourages demand for value preservation, and Bitcoin and other cryptocurrencies could be an answer for consumers in Africa.