Between the years 2020 and 2021, Africa’s cryptocurrency market grew by more than 1,200% while Kenya, Nigeria, South Africa, and Tanzania now all feature in the global top 20 for crypto adoption, according to the latest Emurgo State of Web 3.0 in Africa report.

Africa’s Share of Global Blockchain Funding Still Under 1%

According to the latest Emurgo State of Web 3.0 in Africa report, the African continent’s cryptocurrency market “grew by over 1,200% between 2020 and 2021.” In addition, four African countries, namely Kenya, Nigeria, South Africa and Tanzania now feature the in the world’s top 20 for crypto adoption.

As shown by the data shared in the report, Kenya, Nigeria, and South Africa accounted for 70% of the $88.5 million in blockchain funding which the continent received in 2021. However, despite this and the fact that African blockchain venture funding growth “was 11 times more when compared to general funding growth,” the continent’s share of total global blockchain funding is only 0.5%. This figure is nevertheless expected to grow when more companies attempt to create solutions to solve problems faced by the continent’s residents.

However, despite the underlying technology’s promise, as well as the impact that crypto assets have had on African residents, the report reveals that as much as 20% of countries in Sub-Saharan Africa have banned crypto assets. The rest have either imposed some restrictions or implicit bans. The Central African Republic is the only African country to designate bitcoin as a legal tender.

As noted in the report, many countries in Africa have not embraced crypto assets due to their perceived risky nature. The collapse of crypto giants like the exchange FTX and subsequent ripple effects have seemingly reinforced governments’ negative perceptions about crypto assets.

Mitigating Against Risks Arising From Regulatory Changes

Therefore, in order to help the continent’s crypto industry get on the good side of authorities, the authors of the report urged industry participants to consider working closely with regulators.

“As the need for the regulation of Blockchain and cryptocurrencies increases, key stakeholders need to work closely with regulators. This will ensure that risks that may arise as a result of regulatory changes are adequately mitigated,” authors of the Emurgo State of Web 3.0 report said.

More transparent regulations, on the other hand, will ostensibly see blockchain’s use cases increase. This increase in use cases will in turn spur further investments in the industry, according to the report.

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