Blockchains in Africa
Notes on Adoption Efforts
Key Takeaways
- •Africa’s growing blockchain adoption offers solutions to longstanding economic challenges, with Nigeria and Seychelles leading on venture capital investment.
- •Blockchains provide efficient alternatives to unstable local currencies and high-fee remittance systems, potentially saving billions in lost value.
- •Early experiments in El Salvador and the Central African Republic reveal the importance of readiness, infrastructure, and governance in blockchain rollouts.
Africa is vast—geographically, demographically, and economically. Its landmass can hold the U.S., China, India, and much of Europe combined. Over 1.5 billion people live across 54 countries, and about 40% of that population is under the age of 15. By 2050, that number is expected to grow to 2.5 billion.
The continent’s youth, resource base, and accelerating tech infrastructure make it a compelling frontier for blockchain innovation. Countries like Nigeria, Seychelles, Ethiopia, Ghana, Kenya, Mauritius, Rwanda, South Africa, and Tanzania are already making moves—whether through policy, partnerships, or grassroots adoption.
Nigeria and Seychelles, in particular, have led blockchain venture capital investment on the continent, capturing over half of all related VC funding. Nigeria—Africa’s most populous country and a leading oil exporter—has seen its millionaire population rise 44% in the last decade. Yet nearly 60% of its population lives on less than $1 per day. This contrast reveals just how much potential crypto economies hold in closing wealth gaps and bypassing broken systems.
#Blockchain Solutions
Currencies
Many national currencies across Africa suffer from chronic inflation. In 2007, Zimbabwe’s hyperinflation reached the point where prices doubled every 24 hours. The South African Rand has also lost significant value in recent years. For individuals and businesses, this makes it difficult to store value or transact reliably.
Blockchains offer a lifeline through access to stable digital currencies like USDC and USDT via non-custodial wallets. These tools allow users to hold assets in more stable units without relying on fragile local financial infrastructure. They also make it easier to raise capital and participate in cross-border investment.
Historically, currencies survived only when backed by force—armies, navies, and centralized control. Bitcoin disrupted that model, creating a decentralized system of trust and value. For African countries navigating currency instability, stablecoins and blockchain-based tokens offer viable ways to detach from inflation-prone fiat systems and adopt global digital standards for savings and payments.
Remittances
Remittances—payments sent by workers abroad back to families at home—are a lifeline for millions across the continent. But they’re also expensive. The average transfer fee sits around 7.45%, consuming over 27 days of income for a low-wage worker.
In 2017 alone, remittances to low- and middle-income countries totaled $466 billion. Fees: $34.7 billion.
That’s not redistributing wealth from rich to poor—it’s extracting from the poor to support inefficient intermediaries.
Crypto can fix this. On networks like Solana, it’s possible to send one million transactions for around $10. But the challenge remains: local banks, vendors, and regulators often don’t accept crypto, and off-ramps are limited.
Debt & Digital Sovereignty
China is now Africa’s largest creditor and has banned public crypto use at home to pave the way for its central bank digital currency (CBDC).
Over the past two decades, China has invested heavily in African infrastructure—roads, railways, ports. But these projects come with long-term debt obligations that limit recipient countries’ independence.
Blockchains offer a potential alternative path—allowing African businesses and individuals to operate globally, raise capital, and store value without relying on local banks, fragile currencies, or permission from centralized authorities.
#Adoption Issues
Progress isn't without missteps. El Salvador made headlines in 2021 by adopting Bitcoin as legal tender. The rollout was rocky. Despite early fanfare, the Lightning Network struggled with adoption, and vendor resistance remained high. The IMF later downgraded El Salvador’s credit rating.
Political context matters too. President Nayib Bukele was accused of using the military and civil police to pressure lawmakers into passing his crime bill.
In 2022, the Central African Republic (CAR) followed suit, adopting Bitcoin as a domestic currency. But only 4% of its population has internet access. The move raised eyebrows, especially given the CAR’s long-standing instability, deep ties to Russia, and a ranking of 188 out of 189 on the global welfare index.
Critics called the move a distraction. Supporters pointed to potential savings and cross-border utility. But serious questions remain: Who benefits from Bitcoin adoption in a country where 96% of citizens can’t access it?
Even the optimistic take—"Now citizens won't need to carry CFA francs to convert into dollars!"—misses the reality: they’ll need reliable internet, blockchain knowledge, and enough savings to absorb network fees, which can often exceed a month's income.
#Final Thoughts
Blockchain networks are not silver bullets. They solve specific problems—and they require infrastructure, education, and thoughtful implementation to work.
In places like the Central African Republic, paying $5–15 in fees to use Bitcoin isn’t practical. That’s a month’s income. It’s not a solution—it’s regression. Blockchains like Solana, with near-zero fees and rapid finality, are far more suitable for emerging markets.
But even then, adoption must be intentional. Builders must recognize the technological and financial literacy barriers that exist. The tools are here. They just need to be deployed with care.
Africa is investing. Builders are building. And while challenges remain, the continent is poised to become one of the most dynamic proving grounds for what blockchain can actually do.