Hey guys? Today I'm gonna talk about cryptocurrency. Crypto is the new thing buzzing online and I'll like to talk about it. So what's cryptocurrency? Cryptocurrency is a kind of payment that can be exchanged online for goods and services. Many companies out there have issued their own currencies, often called tokens, and these can be traded specifically for the good or service that the company provides. Think of them as your arcade tokens or casino chips. You’ll need to exchange real currency for the cryptocurrency to access the good or service.
Cryptocurrencies work using a technology called blockchain. Blockchain is a decentralized technology spread across many computers that manages and records transactions. Part of the appeal of this technology is its security. According to CoinMarketCap.com, a market research website, there are more than 6,700 different cryptocurrencies which are traded publicly. And this currency keeps on proliferating, raising money through initial coin offerings, or ICOs. As at Dec. 18,2020, the total number of cryptocurrencies was more than $645.7 billion, according to CoinMarketCap, and the total value of all bitcoins, the most popular digital currency, was pegged at about $421.7 billion.
Why are cryptocurrencies so popular?
Cryptocurrencies appeal to their supporters for a variety of reasons. Here are some of the most popular:
Supporters see 1)cryptocurrencies such as Bitcoin as the currency of the future and are racing to buy them now, presumably before they become more valuable
2)Some supporters like the fact that cryptocurrency removes central banks from managing the money supply, since over time these banks tend to reduce the value of money via inflation
3)Other supporters like the technology behind cryptocurrencies, the blockchain, because it’s a decentralized processing and recording system and can be more secure than traditional payment systems.
Cryptocurrency is not bound by geography because it is internet based; its transactions are stored in a database called blockchain, which is a group of connected computers that record transactions in a ledger in real time.
The difference between cryptocurrency and, say, Visa or Mastercard, is that a cryptocurrency is not now regulated by government and doesn’t need middlemen, and transactions rely on the internet, which means they can happen anywhere in the world.
Now, how will it affect Africa as a continent... Africa is rarely mentioned among the largest markets for cryptocurrency, but it may be set to steal a march over other markets. Many African countries are struggling with high inflation rates and volatile currencies, at the same time there are problems such as capital controls and a lack of banking infrastructure. These factors have helped create an ideal breeding ground for currency alternatives in Africa. Africa currently leads the world in trade volume. Over the next five years, Africa will become the leading Bitcoin crypto-continent with its enormous growth in trading volume. It will grow in ways that no one can imagine. Cryptocurrencies can be used to help the high number of unbanked people in Africa. As it is now, the number of Africans with access to banking services rose from 54 percent to 63 percent.
To speed up crypto adoption more has to be done. Firstly, there is a dire need for crypto education. Educating the community on cryptocurrency will help bring more people to accepting cryptocurrencies. There are a few firms across the continent who have started works aimed at shinning more light on digital currencies. However, this is not enough, more individuals, governments, and institutions need to educate on the importance, nature and technical details of cryptocurrencies.
It has been more than a decade since bitcoin was launched and still, countries, not only in Africa but also in other parts across the globe know little on cryptocurrencies. Without education, setting up crypto ATMs, and businesses around the country will not help in the adoption of these currencies.