- The price of Bitcoin is currently above $8,000 after a recent spike in the crypto market.
- Analysts believe users’ interest will continue to grow in 2020 despite slow adoption across Africa.
- Market washers also await company-backed initiatives (such as Facebook’s Libra), all competing to gain adoption across the continent.
Last week, the price of Bitcoin rallied to $8,400 and it is currently trading above $8,000.
Jack Dorsey, co-founder at Twitter Inc. and other crypto analysts have bet on Africa as the future of cryptocurrency, especially Bitcoin.
The African market is still largely unexplored when it comes to cryptocurrency adoption. A lack of fast and reliable internet access is one of the root causes for the slower adoption of cryptocurrencies in Africa.
However, analysts believed that smartphone penetration and the rise of mobile payments will change the outlook for cryptocurrencies in Africa in this decade.
The year 2019 also shows that there is a lot of interest in the leading alternative coin (altcoin) which is helping to bring buyers back into the sector.
Market watchers like Luno's CEO, Marcus Swanepoel, continue to look for a correlation between the move into haven assets and an increase in cryptocurrency buying.
“There is certainly a link with investors, for example, buying gold and using digital assets for a small, but potentially high return, part of their allocation, but at Luno we think the price increase in BTC is down to more structural reasons.”
Africa still wary of digital currency as an alternative to government-issued currencies
In Africa, regulation is still one of the issues facing the cryptocurrency market. For Nuno Correia, CEO and Founder of Utrust, a cryptocurrency payment solution, the regulatory landscape in Africa will likely evolve by mirroring other jurisdictions.
“Some African governments might be wary of immediately displacing government-issued currencies, even though many are prone to high volatility, inflation and regular reissues. While this might hamper technological initiatives that require a pro-active regulatory framework, it will not deter continuous user adoption of cryptocurrencies.”
What are the issuing shaping cryptocurrency markets in Africa in 2020?
Correia told Business Insider SSA that although cryptocurrency adoption and home-grown projects in Africa are still lagging, user interest is growing. “Its practical use as a resilient alternative to local currencies for payments will continue to be a draw as the de-facto use-case.
“Localised efforts to establish exchange branches will continue, which will offer new ways to access the ecosystem. This will be complemented with company-backed initiatives (such as Libra), all competing to gain adoption across the continent,” he said . Utrust will continue to build an ecosystem that makes cryptocurrency payments simple and frictionless.