Illiteracy and low crypto-education are not the reasons Africans didn’t welcome Cryptocurrency.
According to Wikipedia, Cryptocurrency is a digital asset designed to work as a medium of exchange using cryptography to secure transactions, to control the creation of additional units, and to verify the transfer of assets.
Lately, a lot is been said about Cryptocurrency and how it has the tendency to turn average people into billionaires within a few years. For this to happen, however, one will have to invest his/her funds in a digital form of currency that will soon become the world’s legal tender in a few years.
At that time, investors will be cash-in by selling their Cryptocurrencies – which could have appreciated by almost 10, 000 percent compared to the initial investment, at higher rates.
Well, despite the tempting nature of the offer, many Africans are not buying this story - and this is why!
Many Africans are more interested in the present especially when it has to do with their money! It will be very difficult to convince an average African to give up their funds with the hope of making much more in ten years or more. Little wonder there is an African proverb that says ‘a bird in hand is worth more than a million in the bush’. Well, to be candid, there is some sense to that.
If you want to convince people to make investments, then you must be able to make a lot of sense through your narratives and arguments. Sadly, this is not often the case when Crypto experts try to convince prospective investors. Many-a-time, they often talk of how fiat currency took over trade-by-barter (which was once practiced in Africa) and crippled the gold standard. This argument will fail to win over the average African because currency in exchange for goods and service is actually a form of barter. Also, the gold standard was never crippled! Gold still plays a significant role in the world economy and its value, demand and/or acceptance hasn’t dropped over time.
Yes, it is true that they say variety is the spice of life, but not when it comes to matters of money! There are well over 700 cryptocurrencies in the world today since it became public knowledge in 2019 and every one of them claims to be the genuine choice while others are undependable. Things like this have a way of scaring Africans.
We cannot deny that the value of all form of currency or legal tender depends on forces of demand, supply and acceptability; Cryptocurrency is no different. Crypto experts say that the more places the particular ‘coin’ is accepted, the more it can be exchanged; this determines the increase in value. The current level of acceptance is one reason why Africans do not invest in Cryptocurrency.
When Crypto entrepreneurs speak to Africans on why they should invest in Cryptocurrency, they try their best possible to mention people who have benefited from their investments. While this is often a good move, it often backfires because the names mentioned are of people in Utopia - whom no one can really tie their successes to cryptocurrency. Africans will not make investments in cryptocurrency unless they see someone in their immediate environment that has become successful from it.
It is best Crypto experts and Crypto entrepreneurs desist from using this statement when speaking to Africans about Cryptocurrency. When an average African hears something like this, the first thing that comes to mind is ‘exploitation’. If you say Africa is the market to be exploited, they average Africans will stay away from you. Africans also find it hard to believe Cryptocurrency will pick up from the continent considering its level of technological advancement.
A Crypto entrepreneur once suggested during a seminar that it would be wise for African governments to each invest One Hundred Million Dollars in Cryptocurrency because they could gain over Seven Hundred Billion Dollars within ten years. During the Q and A session, a young observer asked him, how many governments in advanced countries have made such investments so far; the Crypto entrepreneur had no answer! Africans are aware Cryptocurrency is a gamble which may pay off…..or fail. Maybe Crypto entrepreneurs should accept this fact and desist from making too many promises because Africans love to gamble. You never can tell, admit it is a gamble and Africans may key in!
The governments of many African countries through their Security and Exchange Commission (SEC) warn against investments in Cryptocurrencies. The Nigerian Security and Exchange Commission publicly released a press release to this effect warning its citizens not to invest in any form of Cryptocurrency. Africans take such warnings seriously because they are fully aware that the SEC is saddled with the responsibilities of protecting the interest of the public. If Cryptocurrency is all they say it is and will be, one cannot help but wonder why Crypto entrepreneurs and experts cannot get African governments and Exchange Commission(s) to partner with them in getting to the people.
If you want Africans to give you their money, buy what you are selling, or invest in your Cryptocurrency, then you should be ready to do more than printing a branded tee-shirt and face cap! Crypto entrepreneurs talk of millions and billions, but you hardly see any success in them. Those who are able to afford small offices and claim to have millions of dollars in investments cannot even afford quality branding, hire professionals or pay good salaries to their company reps. This fends off Africans from investing in Cryptocurrency.
When trying to get people to invest in their Cryptocurrencies, many Crypto companies and entrepreneurs often say that it is an online member-only community which does not deal with ‘outsiders’. Well, this will not work with Africans because many Africans do not trust a process they cannot see, locate and physically be a part of. The only reason Africans trust and use mobile banking is that the banks have physical branches and representatives around them which they can access in case of emergencies. An online operation without such provisions for guarantee will scare off Africans.
This is not to say however that Cryptocurrency will not succeed in Africa, but Crypto experts, entrepreneurs, and companies must take the aforementioned into consideration if they plan to succeed in Africa.
Header Image Credit: Corporate Compliance Insights
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