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Could Bitcoin Become the First Pan-African Currency?



Pan African Currency

Bitcoin is the world’s first truly global currency that anyone can use to make payments and transfer funds. In Africa, bitcoin has so far been growing primarily in South Africa, Kenya, Nigeria and Ghana and is currently being used mainly as an investment and for private international remittances. But does it have the potential to become the first pan-African currency?

Here are some reasons as to why people believe that Bitcoin, will be the leading global currency.

  • Anyone with Internet access can use bitcoin
  • Bitcoin is not controlled by any government or central bank
  • Payments and money transfers take less than 30 minutes
  • The cost of a bitcoin money transfers is minimal
  • Transactions are transparent as they are publicly recorded on the blockchain
  • There is a fixed supply of bitcoins, so hyperinflation cannot occur

Bitcoin remittances in Africa

While, in theory, bitcoin remittances make sense in Africa the reality is that there is the (partly) costly challenge of exchanging the received bitcoins into local African currency. For this reason, bitcoin remittances are currently not the cheapest way to remit funds into Africa, according to a report by US bank Citigroup. However, as exchanges are expanding and the bitcoin economy is growing in Africa, bid/offer spreads will tighten and bitcoin remittances will become a viable way to transfer money across borders at a low cost.

There will be an increase in money remitted to sub-Saharan Africa from people in the diaspora. Western Union and MoneyGram have been the main beneficiaries of it. This is one of the key reason why so many people in the bitcoin economy believe that bitcoin will succeed in Africa, as the costs of cryptocurrency-based remittances are substantially lower than using the before-mentioned expensive traditional Money TransferOperatorss (MTOs).

So far, consumer bitcoin remittances into Africa have only really taken place on a small scale as can be seen in the video by below. But as the bitcoin infrastructure improves in Africa, the trend for bitcoin remittances will undoubtedly be positive.


Bitcoin as a store of wealth and as a spending currency

Once bitcoin volatility reduces (which arguably will take quite some time) bitcoin will very likely become a viable store of wealth. Furthermore, as merchant adoption increase both globally and in Africa (as seen in South Africa), Africans will be able to use bitcoin as means of payment across the continent. The reality is, however, that it will take a substantially amount of time for this to occur.

In fact, bitcoin adoption correlates to some degree with Internet penetration in Africa. It is not surprising that the countries with the highest Internet penetration are also those spearheading bitcoin adoption on the continent. As affordable access to the Internet spreads in Africa, so will bitcoin as a store of wealth, a means to transfer money and as a spending currency.

To answer the question in the title of this article: YES, bitcoin could become the first pan-African currency. This could occur once internet penetration reaches the majority of the continent and global bitcoin adoptions increases, to the extent where it becomes globally recognized as legal tender. Whether that will happen or not, remains to be seen and, if it does, it will take a long time.



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Bitcoin Wallet Luno Adds SegWit Support to Lower Transaction Fees



Luno Adds SegWit Support

Luno, one of the most popular bitcoin wallets in Africa, has announced full SegWit integration for bitcoin send and receive transactions. Previously, Luno customers could only receive BTC through a legacy wallet address, which was not integrated with the recent Bitcoin blockchain upgrade SegWit. Only send transactions were SegWit compatible.

With the full integration of SegWit, Luno users can now enjoy cheaper and faster bitcoin transactions.

“By implementing SegWit internally, Luno has managed to reduce the send fees paid by customers by over 25% already. As customers start switching over to new SegWit addresses, this will translate into a further reduction in sending fees in the coming weeks and months,” Werner van Rooyen, head of marketing and communications at Luno stated.

Luno currently operates in South Africa, Nigeria, Malaysia, UK, and in 35 other European countries.

What is SegWit?

Segregated Witness (SegWit) was an upgrade to the Bitcoin blockchain that is intended to address Bitcoin’s scalability challenges as well as fix the issue of transaction malleability. With SegWit, signature data is separated from transaction data in order to enable more transactions to fit into each block. The signature data is kept in an extended block called the witness. As a result, bitcoin transactions become faster and transaction fees become lower.

In theory, the Bitcoin network can handle seven transactions per second. However, in reality, it is around four transactions per second. With the number of bitcoin transactions increasing as bitcoin’s popularity grows, transactions take longer as the unconfirmed transactions pool increases. Therefore, bitcoin users who can afford it have been paying higher transaction fees to incentivise miners to prioritise their transactions and, thereby, increase the speed of their transactions. At the end of 2017, this has led to the average bitcoin transaction fee spiking to over 35 dollars.

However, when SegWit addresses are used, bitcoin transactions become faster and the required resources decrease as well. Consequently, the transaction fees reduce.

How Can You Add a SegWit Wallet Address on Luno?

To add a SegWit address on the Luno wallet you have to follow these steps:

  • Open your Luno account either on the mobile app or the web app
  • Choose “wallets” from the menu
  • Click on your “BTC wallet”
  • Choose “receive bitcoin”
  • Click “add address” and follow the prompt

To receive bitcoin, use your SegWit bitcoin receive address. Legacy bitcoin addresses begin with 1 while SegWit bitcoin addresses begin with 3. Even after adding a SegWit wallet address, bitcoins sent to your previous legacy bitcoin address will still work. In addition, you can still send bitcoin from a SegWit wallet to a legacy wallet and vice versa since the transactions are still taking place on the same blockchain. But if you are sending bitcoins to and from a SegWit wallet, you can benefit from reduced fees.

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Bitmart Opens Cryptocurrency Mining Hardware Store in South Africa



Bitmart Opens Cryptocurrency Mining Hardware Store

Bitmart, South Africa’s leading supplier of mining hardware, has opened a cryptocurrency mining hardware store in South Africa. This makes Bitmart’s retail outlet the first cryptocurrency mining store in Africa.

Products and Services Offered by Bitmart

Bitmart was founded by CEO Jacques Serfontein in 2015 to offer cryptocurrency mining hardware to South Africans. Currently, Bitmart offers GPU rigs, ASIC miners, GPU rig mining software, graphics cards, international mining rig monitor app, cryptomatic watches, hardware wallets, and motherboards. Customers can find GPU mining rigs that mine cryptocurrencies such as zcash, monero, decred, bitcoin, and litecoin.

Additionally, Bitmart provides services such as bitcoin mining farm design and deployment, mining training, antminer repair tickets, mining farm management using Genesis Hive, and shepherd services.

Through its shepherd services, Bitmart helps owners of second-hand miners to find buyers. Therefore, both sellers and buyers are assured of safe and secure transactions through Bitmart’s SSL-secured online shop.

According to MyBroadband, Bitmart is an authorised distributor of Avalon Miners, Genesis Hive, Trezor, Ledger wallets, KeepKey, and UniSat (satellite mining solutions) in Africa.

The company also supplies mining hardware to countries such as Japan, Dubai, North America, Australia, and England.

What Does Bitmart Plan for the Future?

Bitmart will be holding seminars in Johannesburg and Mbombela. The seminars will focus on bitcoin basics and advanced cryptocurrency trading. In addition, Bitmart will be introducing a satellite mining connection in partnership with Uniwisp that will allow mining rigs to mine from any place in the world. Uniwisp is an Internet service provider based in Nelspruit, South Africa.


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Kenya’s BitPesa Acquires Spanish Money Transfer Platform TransferZero



BitPesa Acquires TransferZero

On February 8, 2018, BitPesa announced that it has acquired TransferZero, a Madrid-based online money transfer platform, which operates in over 200 countries using more than 50 currencies.

Why Did BitPesa Acquire TransferZero?

BitPesa, which is already operating in Africa and Europe, will be able to “set deep roots to UK and European licensing, bank accounts, and integrations” through this acquisition, according to the company’s statement on its blog.

“Europe is a hub for global remittance and payments companies. Digital currencies and decentralized technology have hit critical mass in the financial services and payments space. It is no longer a question of whether this technology will have staying power [but] which specific technology and what product iteration will launch and scale first […],” Elizabeth Rosiello, founder and CEO BitPesa said.

“BitPesa has the support of top-tier, institutional investors and a network that will help to bring TransferZero’s technology to the next level. With this support, we will be able to provide even more efficient transfers and user experience,” Luis Cambronero, former TransferZero CEO and present Managing Director, BitPesa stated.

Setting Up Infrastructure Across Europe and Africa is a Priority

“Setting up infrastructure across Europe and Africa has always been a focus of ours. […] We’ve just doubled our bank accounts, our infrastructure, and it’s licensed by the Bank of Spain as a payment institution. So we are fully compliant with PSD2 regulations […],” Rosiello said.

“This is truly a partnership where the whole is greater than the sum of the parts, allowing BitPesa to solidify our leadership in this space. By bringing our regional and technological expertise together, we will further accelerate our month-to-month growth,” Rossiello asserted.

TransferZero will neither change its name nor its headquarters. In addition, its employees will remain with Bitpesa.

This acquisition from an Africa-based bitcoin startup of a European fintech startup shows that leading African startups can make waves beyond the borders of the continent and create a positive impact on a global scale.

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