Chainalysis Report: Bitcoin adoption in Sub-Saharan Africa is the highest in the world

Chainalysis, the blockchain data platform is sharing its focus chapter on Sub-Saharan Africa, as part of the Chainalysis 2023 Geography of Cryptocurrency Report. Last week, the first chapter, The 2023 Global Cryptocurrency Adoption Index was published, as well as the chapter about Central & Southern Asia.

Some highlights of the Sub-Saharan Africa chapter:

- Adoption and use of Bitcoin in Sub-Saharan Africa is the highest in the world. The report dives into how and why.
- The use of homegrown Sub-Saharan Africa-based exchanges continues to outpace global exchanges.
- With a 9% growth rate, Nigeria was one of only six countries in the world where transaction volume grew year-on-year. The Naira crisis led to further adoption of cryptocurrency. In the report Chainalysis maps how interest in Bitcoin and stablecoins has generally risen as the Naira’s value has decreased.

- Here is the full, embargoed Sub-Saharan Africa chapter.

Cryptocurrency penetrates as an inflation mitigation and trading vehicle



Similar to previous years, Sub-Saharan Africa has the smallest crypto economy of all regions, accounting for 2.3% of global transaction volume between July 2022 and June 2023. During that time, the region received an estimated $117.1 billion in on-chain value.

Although Sub-Saharan Africa has consistently been one of the smallest cryptocurrency markets, a closer analysis reveals that crypto has penetrated key markets and become an important part of many residents’ day-to-day lives. Nigeria ranks second overall on the Global Crypto Adoption Index Kenya (21), Ghana (29), and South Africa (31) rank high on the index.

In no region is Bitcoin more dominant than Sub-Saharan Africa, as the world’s first cryptocurrency makes up a bigger share of transaction volume than in any other region.

Alternative store of value

Sub-Saharan Africa residents are likely turning to so-called digital gold for an alternative store of value. Many countries in the region have struggled with rising inflation and debt, making cryptocurrency an attractive means of storing value, preserving savings, and attaining greater financial freedom.

Impact of regulation and Luno’s experience

The increased regulatory clarity provided by the flurry of recent legislation may be helping Africa’s local cryptocurrency industry. Many of the most important crypto regulations enacted by Africa’s biggest countries came around early 2023.

South Africa’s proactive approach to regulation has removed a lot of regulatory uncertainty and thus encouraged crypto trading. Luno indicates that presently, the predominant use case for crypto in South Africa revolves around investment and that over the last three years, the number of customers holding a meaningful crypto balance on Luno has increased by almost 50%.

In addition, Luno says that the industry develops more responsibly in markets with no regulatory bans - the market operates above the ground and there is more productive interaction between regulators and exchanges. Bans don’t stop people from wanting crypto, but it is in everyone's interest that there is some pragmatic regulation in place that protects consumers and creates a safer operating environment for all.

The consumer safety afforded by better regulations, the confidence those regulations give consumers, and local crypto businesses' ability to comply with those regulations may be part of why local African exchanges have been outpacing international competitors on growth within the region since early 2023.

While residents of wealthier nations may buy and sell more cryptocurrency than those of emerging markets, there is a greater day-to-day need for cryptocurrency in emerging markets, very much in line with the original vision for Bitcoin.

To learn more about the methodology of the 2023 Global Cryptocurrency Adoption Index, click here.