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Regulations Are Hindering the Growth of Bitcoin in Egypt



bitcoin in egypt

Rumours have spread this week on social media in Egypt that the country’s central bank is considering official adoption of cryptocurrency. These rumours circulated in the Egyptian social media sphere on July 16, and 17. The rumours, however, were debunked by Mr. Gamel Negm, a deputy governor of the Central Bank on July 17. The swift official reaction by the Egyptian Central Bank has catalysed a series of theories trying to proffer reasons for the Government’s seeming outright rejection of the bitcoin adoption idea.

Bitcoin Will Not Be Regulated in Egypt anytime soon

Lawyer Mahmoud Helmi is of the view that the Central Bank’s rejection of bitcoin was based mainly on the fact that the existing legal and regulatory frameworks in the country do not make provisions for individuals to deal in foreign exchange. Since bitcoin is not the legal tender of the Egyptian state, it can be easily classified as foreign exchange and dealings in foreign exchange are limited only to banks.

This then begs the question, will Egyptian banks be allowed to deal in bitcoins instead of individual citizens? And how will this be implemented considering that most bank officials and executives at the moment do not fully grasp the workings of blockchain technology?

Helmi further raised the issue of the promise of “illusory profit” that some bitcoin dealers might paint in order to woo clients but might be unable to fulfill within the promised time-frame due to the high volatility of bitcoin and altcoins. He believes this could lead people into a collision course with the law since Egypt’s penal code “defines the crime of swindling in an ambiguous way”.

Ashraf Ibrahim, a banker and economist with Zagazig University, raises an interesting angle that suggests that the possible lack of control of bitcoin by the government might be a reason for its opposition to bitcoin adoption.

Unlike sovereign currencies where there are defined processes to tax and charge fees on transactions, governments seem to be at a loss on how to track, tax, and charge fees on cryptocurrency transactions. There is the fear that with a wider adoption of cryptocurrencies, the government might gradually become irrelevant and their coffers might begin to run dry due to an inability to tax these transactions.

Concerns over bitcoin’s pseudo-anonymity

There is also the school of thought that the Egyptian government’s opposition might be based on the largely anonymous nature of bitcoin transactions. Ahmad Adam, head of the National Bank of Egypt’s Research and Studies department, states that his support for the Central Bank’s move is based on the fact that the anonymity the cryptocurrency offers might help to fuel money laundering and terrorism financing in the country.

He also assumes that to own bitcoins, citizens would have to convert Egyptian pounds to other foreign currencies such as the dollar and euro before bitcoin purchase could be affected. He believes this could have a negative impact on the value of the Egyptian currency. This view, however, is to some extent erroneous because with the help of mediums such as and other OTC transaction processes, people are able to purchase bitcoins directly with their local currency.

It does not seem though that discussions on digital currency adoption by the Egyptian state have been totally thrown out the window. Egyptians, being quite the innovative people, believe there is the likelihood of this topic being re-visited in the near future and an adoption could happen with better regulatory and operational framework.


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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