Africa’s Crypto Market Just Took a Hit From FTX’s Collapse

Africa’s Crypto Market Just Took a Hit From FTX’s Collapse
Ugandan Bitcoin miner Godfrey Kabaka Mumpe addresses fellow Ugandans about the currency, Kampala, Uganda, March 8, 2018 (AP photo by Stephen Wandera).

On Dec. 12, Sam Bankman-Fried, once described as the J.P. Morgan of the crypto industry, was arrested in the Bahamas and charged with defrauding investors, just a month after his $32 billion cryptocurrency exchange, FTX, filed for bankruptcy. FTX’s collapse sent shockwaves through the crypto world, perhaps felt nowhere more acutely than in Africa.

Africa may be the smallest market in terms of volume of crypto transactions—it registered just $105.6 billion worth of net gains in cryptocurrency between July 2020 and June 2021, or around 1.5 percent of the global volume of $15.8 trillion. But it is still one of the fastest-growing crypto markets in the world, expanding by 1,200 percent in that same period.

Cryptocurrencies are particularly popular in Kenya, where 8.5 percent of the population uses them; South Africa, at 7.1 percent; and Nigeria, at 6.3 percent, according to the United Nations Conference on Trade and Development. In 2021, Nigeria posted the highest trading volume in Africa, worth over $760 million.

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