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Hybrid "Crypto-Fiat" Platforms are Set to Takeover the African Financial Markets

Regarding cryptocurrencies and its continued growth in certain parts of Africa, Nigeria ranks sixth among the top countries adopting cryptocurrencies. In 2022 alone, despite the CBN ban, 33.4 million Nigerians owned or traded cryptocurrencies, which accounts for 35 per cent of the population aged 18 to 60. Such a dodged market have driven a surge in hybrid crypto-fiat platforms offering everything from fiat-crypto exchange to payments, remittance, investments and more. The trend is the same across Africa where both leading international crypto services providers like Binance and Luno and native exchanges like ChainEx and Chipper Cash are driving financial inclusion and easing transactions through crypto-fiat services. With the demand for financial inclusion, increasing reliance on P2P foreign remittance to African countries, increasing internet usage and crypto/blockchain adoption across the continent, crypto-fiat platforms have a golden opportunity become the market kings, outperforming traditional financial institution and steering a chunk of the market to themselves. Binance is taking a bold step to include services such as airtime and bills payment amongst others, emulating existing fintech platforms in terms of utility. This trend will likely permeate other companies and speculations are that we might see a proliferation of hybrid crypto-fiat platforms. The success of these platforms will be largely dependent on the ease with which they enter into the markets and how efficient their services become, a challenge that business developers and marketers might find appealing. Nonetheless, the facts are that the figures and data are in the favour of hybrid platforms or those who intend to build such platforms —crypto adoption in Africa is growing; the population is youthful; P2P use is on a daily uptrend; and local fiat currencies in most African countries are not performing any better.

The Dollar Channel: How P2P is shaping foreign remittance

Peer-to-peer remittance is relatively new compared to other forms of international money transfer. P2P platforms match buyers and sellers of different currencies or let's remitters send money directly to beneficiaries. Unlike wire transfers where banks often charge excessively high exchange rates margins, usually 5% per transaction, P2P services usually charge a commission of 0.5 to 1.5%. P2P transfers are also faster. Users don't have to wait for 5 working days for transaction to go through. For cryptocurrency transactions, P2P offers users the benefit of privacy or anonymity. As a result of its cost and time saving advantages, money transfer providers worldwide are increasingly adding P2P options to their cross-border payment offerings. And with P2P crypto remittance becoming more popular, we can expect to see a dwindle in bank and card money transfers and dominance of P2P remittance in the coming years. In the first quarter of 2021, Nigeria traded just over $99 million in peer-to-peer transactions with leading crypto exchange, Binance, with a significant chunk of the reported volume. In the same time frame, Kenya and Ghana also had high transaction volumes. More so, stringent policies by central financial governing bodies are catalysing the growth of these P2P channels in African countries. The economies of developing countries lacking a clear structure for their exchange markets will likely see increased use of P2P infrastructures — citizens will opt to hedge weakening native fiat currencies with dollar backed stable digital assets, putting further stress on the weakening currencies. It is, however, left to the economic leaders of such countries to think on the best possible ways to create a sustainable environment for innovation to thrive in such a way it won't be detrimental to the economy.

Is Doomsday over? What 2023 Holds for Crypto

2022 was certainly a scary year for crypto-lovers. With the market experiencing one of its darkest valleys of losses following the Luna crash and demoralising FTX bankruptcy; fear, uncertainty, and pessimism took over at an all-time high. The result is a massive sell-off of crypto assets and little investments coming in. It begs the question, "will crypto survive?" I think YES. Historically, the crypto market has always bounced back, especially after an all-time low. We saw it in 2020 when the market skyrocketed after plummeting 80% between 2014-2018. While not all projects that fell through in 2022 will come back , you can be assured of the survival of leading cryptos like Bitcoin and Ethereum in 2023. A sizable spike in the price of BTC or ETH owing to returning investors' and enthusiasts' trust in crypto as a faster, fairer, more secure and decentralised alternative to traditional financial systems is usually enough to revive the entire cryptocurrency market.