The crypto sector in Africa is now experiencing a fundraising boom that shows no indications of abating any time soon.
304 million dollars worth of money entered the African blockchain ecosystem during the first quarter of 2022, followed by another $213 million in the second quarter.
Africa continues to receive VC funding
The pre-Series B investment round for the Seychelles-based cryptocurrency trading platform KuCoin raised $150 million in May, raising the company’s overall worth to $10 billion US dollars. Mara, a Pan-African cryptocurrency exchange, subsequently raised $23 million, while the Nigerian and Congolese firms Jambo and Afriex raised $30 million and $10 million, respectively.
According to the African Blockchain Report 2021, which was produced in collaboration with Standard Bank and Crypto Valley Venture Capital, capital increased by 1,668 percent between Q1 2021 and Q1 2022, going from $5.1 million to $91 million.
Additionally expanding, crypto-centric payments had a 1,200 percent increase between July 2020 and June 2021. Despite these startling figures, just 0.5% of the total blockchain funding in the world comes from Africa, making sure that the crypto sector in Africa is experiencing a fundraising boom,
Four nations accounted for the majority of inflows
Nigeria, Kenya, South Africa, and the island nation of Seychelles, three of Africa’s “big four” startup ecosystems, together accounted for $122 million of the total VC inflows. Seychelles raised 33.8M, followed by Nigerian crypto businesses with $49.6M. Crypto firms in Kenya and South Africa were able to amass $20 million and $18.8 million, respectively. The report also said:
“The lack of common legacy financial systems and an enormous population, primarily unbanked, all contribute to the popularity and growth of cryptocurrencies on the continent.”
Finally, nations like Ghana, Burkina Faso, Egypt, and Cameroon were successful in luring investments of $125k, $300k, and $4.1M, respectively.
P2P payments are expanding
The growth of peer-to-peer (P2P) payments among small enterprises and cryptocurrency investors shows that the African populace is embracing blockchain technology broadly. As noted by Ian Putter, Regional Director for Africa of the Blockchain Research Institute and Head Blockchain COE at Standard Bank:
“Countries like South Africa, Kenya, Nigeria, and Ghana have seen a rapid uptake of crypto assets to access more efficient payment trails provided by blockchain networks and yield returns on income with assets like Bitcoin or stablecoins pegged to the value of the US dollar.”
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