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Weekly News Roundup: New Crypto Exchange Launches in South Africa, Nigerian Startup Goes DeFi

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Every week, we search for the best crypto and blockchain news in Africa. This week, we cover the introduction of a new crypto exchange in South Africa, among other stories.

New Bitcoin Exchange Launches in South Africa

Cape CryptoEx-Luno software developer, Leon Kowalski, has started a crypto exchange in South Africa. Cape Crypto, which launched on November 5, 2020, will allow users to buy bitcoin without the need to verify their identities.

Moreover, Kowalski says the platform will offer the lowest trading fees in the country. Cape Crypto only accepts deposits in South African Rand and bitcoin. The exchange joins other crypto platforms in South Africa like Luno, ICE3X, AltCoinTrader, VALR, and Paxful.

“Being able to register and buy within a minute, Cape Crypto is the fastest way to buy Bitcoin in SA. This is because customers do not need to verify their identities before they can start buying. It is a simple process of confirming their email address, instantly depositing Rand, and buying Bitcoin,” Kowalski told ITWeb Africa.

Although users will not need to verify their identities before purchasing bitcoin, they will have to do so to make withdrawals.

Nigerian Startup Xend Finance Launches DeFi Platform

Xend Finance, a startup based in Nigeria, has launched a DeFi platform for credit unions. Also, the startup has received a strategic funding round of $1.5 million. The company has built its product on Binance Smart Chain.

Speaking to CoinDesk during an interview, Xend Finance Founder and CEO Aronu Ugochukwu said: “A major problem faced by these credit unions or cooperatives is a constant devaluation of the currency because most of the time our economy is unstable.”

Xend aims to promote financial inclusion in developing countries “by converting deposits into crypto and harvesting yield on DeFi platforms” like Aave and Compound. The company has received backing from organisations like Google Launchpad, TRG Capital, and Binance Labs.

Binance Africa Re-Introduces Affiliate Program

BinanceBinance Africa has re-introduced its affiliate program to help promote brand identity and awareness across the continent. The program is open to crypto influencers, crypto traders, content creators, and cryptocurrency enthusiasts in Ghana, South Africa, Uganda, Nigeria, and Kenya.

You can join this program if you love educating others and are knowledgeable about cryptocurrencies and blockchain technology. You can sign up if you have a large online audience, an account on Binance, and are good at brand promotion.

In return for promoting the Binance brand, affiliates will get paid. For instance, for each point you earn, you will receive a cash equivalent reward of up to $3,000. Potential affiliates will get more details about the rewards once Binance approves their applications. To apply, visit the Binance website.

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Weekly Roundup: Crypto Market in Africa Grows by Over 1,200%, Paxful Integrates Lightning & More

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In this week’s news roundup, we will cover the rapidly growing crypto market in Africa, Paxful adding Lightning support, and other top stories.

Crypto Market in Africa Grows by Over 1200%

According to a report preview by Chainalysis, the crypto market in Africa has grown more than “1,200% by value received in the last year.” Additionally, the continent “has some of the highest grassroots adoption in the world.”

Chainalysis also noted that Africa’s cryptocurrency economy is the smallest but the most dynamic and exciting.

Crypto Market in Africa

“In addition to being the third-fastest growing cryptocurrency economy, Africa also has a bigger share of its overall transaction volume made up of retail-sized transfers than any other region at just over 7 per cent, versus the global average of 5.5 per cent,” Chainalysis wrote.

Africans are also the biggest users of P2P platforms.

About 47 Per Cent of South African Adults Hold Crypto

Market research and data specialist company KLA has found that about 47 per cent of South African adults hold cryptocurrencies. However, the highest number of this population holds low-value crypto investments.

“While this percentage is high, the amount invested is low. This indicates that the bulk of South African crypto investors are experimenting and dabbling without making a significant financial investment,” said Tessa Nowosenetz from KLA.

KLA’s study discovered that 25 per cent of those interviewed hold crypto worth between $7 and $70. On the other hand, thirteen per cent of the respondents hold cryptocurrencies worth between $7 and $700. The KLA study also found out that 43 per cent of the respondents are mainly interested in making quick gains.

Paxful Integrates Lightning

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Paxful has announced that it has integrated the Lightning Network on its platform to provide faster and cheaper transactions. The initiative is in partnership with Lightning Labs.

“The Lightning Network is the cheapest option for Bitcoin micropayments, which will massively amplify Paxful’s work around leveraging how Bitcoin can be used as a means of exchange rather than a speculative asset. Lightning is capable of handling 5 to 10 transactions per second but it has the potential to process hundreds of thousands of transactions per second,” said Paxful CEO Ray Youssef.

According to Youssef, the Lightning Network will accelerate adoption because it will make bitcoin “a strong financial contender for everyday transactions.”

Zimbabwe’s Minister of Finance Shops for Crypto Solutions in Dubai

Recently, the Minister of Finance in Zimbabwe, Mthuli Ncube, visited the DMCC Crypto Centre in Dubai where he identified solutions for cheaper remittances.

“I visited the DMCC Crypto Centre in Dubai, which is a fascinating incubation hub for cryptocurrency and payment solutions. [I] came across solutions that could lower charges for diaspora remittances,” he tweeted.

While it is not clear whether the country will follow up this visit with a partnership, Ncube’s openness to crypto is seen as a good sign. However, payment platforms in Zimbabwe are at a loss why the Minister had to seek solutions in Dubai. For instance, Uhuru Wallet is a blockchain-based platform that facilitates remittances in the country.

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Weekly Roundup: Locals in Senegal Lose Hope on Akon City & More

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A major event went down this week when El Salvador became the first country to accept bitcoin as legal tender. This step could have opened the door for more countries to start embracing cryptocurrencies. Cuba, for instance, announced that it will start recognising and regulating cryptocurrencies.

Back to the African crypto space, locals in Senegal have lost hope in the development of Akon City. Keep reading to learn about this and other top stories on our weekly news roundup.

Locals in Senegal Lose Hope on Akon City

After erecting a ceremonial stone on the grounds where Akon City is set to stand, the villagers of Mbodiene have not seen any activity from the developers since. They are now in doubt, wondering whether this city that could change their lives will ever become a reality.

“They laid the foundation stone with a lot of speeches and promises. Compared to everything that was announced, I do not think we have seen much yet,” said Jules Thiamane, a 35-year old local.

The movie Black Panther-inspired the vision behind Akon City, a $6 billion smart city with a crypto-powered economy. Named after its visionary, Akon, the proposed city will have a shopping centre, hospital, waste centre, police station, school and solar power plant by 2024. The developers plan to fully complete the project in 2030.

However, Paul Martin of the engineering firm that won the contract to construct the city says that plans to build the city are still ongoing. He also said the project has raised over $4 billion in funds and may begin in October after the Akoin project in Kenya is complete.

CBN Plans Tiered AML/KYC Requirements for eNaira

Central Bank of Nigeria

GodwinPaya, CC BY-SA 4.0, via Wikimedia Commons

The Central Bank of Nigeria (CBN) plans to roll out tiered AML/KYC requirements with its digital currency in October.

The central bank will launch the pilot testing of eNaira, the central bank digital currency (CBDC), on Independence Day, October 1. Besides a tiered ID verification system, CBN will create transaction limits for each tier.

According to an article on Cointelegraph, these CBDC plans could indicate that more anti-crypto laws are likely to arise in Nigeria. For instance, China intensified its crypto crackdown efforts after rolling out its digital currency for public testing.

The eNaira will complement the Naira, but it will act as a non-interest-bearing digital currency.

Luno Restricts Customer Withdrawals

LunoCryptocurrency exchange Luno has set new rules restricting customer withdrawals. According to the exchange, the purpose of the restrictions is to “act as a deterrent for illicit actors moving large amounts of funds within the crypto ecosystem.”

The exchange is using a risk-based approach to set the limits for each client. However, Luno has not disclosed how it sets these dynamic risk-based limits. The limits are also different from those published on the website.

Interestingly, Luno users cannot influence their risk scores. However, they can “optimise their risk position by keeping their account information up to date, enabling safety features on their account, and generally keeping their account secure,” said Marius Reitz, the GM for Luno Africa.

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Weekly Roundup: Malicious Crypto Miners Remain a Threat in Africa & More

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This week saw El Salvador approve a $150 million fund to enable conversions from BTC to USD. The announcement gave the bitcoin price a boost, which was almost $50,000 at the time of writing. In other news, Kaspersky has reported that the threat of malicious crypto miners remains prevalent in Africa.

Read this and other top stories in this weekly roundup.

Malicious Crypto Miners Remain a Threat in Africa

Cybersecurity and anti-virus provider Kaspersky has detected over 1,500 fraudulent global resources targeting investors interested in crypto mining since the beginning of 2021. The company has prevented over 70,000 user attempts globally from accessing such websites.

The threat of malicious crypto miners is prevalent in Africa. According to Kaspersky, the share of users that malicious crypto miners targeted in South Africa were 0.6 per cent in H1 2021. In Kenya, Nigeria, Ethiopia, and Rwanda, that share was 0.85 per cent, 0.71 per cent, 3.68 per cent, and 3.22 per cent, respectively.

“Although these percentages [appear] low and may not seem significant to users, crypto-miner malware has been identified as one of the top 3 malware families rife in South Africa, Kenya and Nigeria at present. We believe [this] emphasises that as cryptocurrency continues to gain momentum, more users will likely be targeted,” said Bethwel Opil, Enterprise Sales Manager at Kaspersky in Africa.

Kaspersky is asking users to apply caution by refraining from clicking dubious links, using a security solution, and downloading apps from official websites. Moreover, crypto investors should think twice before accepting offers that are too good to be true and before buying products online from unknown companies.

Binance Smart Chain Celebrates the First Anniversary

BinanceThis September, Binance Smart Chain (BSC) is celebrating its first anniversary. Since launching in September 2020, BSC’s ecosystem has attracted over 800 DApps.

The DeFi and NFT infrastructure also offers super speeds, breaking the all-time high of 13.1 million daily transactions, a record that no blockchain has hit before.

BSC held a virtual conference yesterday on September 1, to celebrate its anniversary. During the conference, attendees received an airdrop from a pool of over $100,000 worth of tokens. Also, BSC will hold a DeFi-themed metaverse expo from September 2 to September 7. From September 8 to September 13, BSC will hold an NFT-themed metaverse expo.

You can also check out their giveaways on Twitter. BSC is rolling out these giveaways in partnership with its projects and partners.

CBN Partners with Bitt Inc. to Launch Digital Currency

Central Bank of Nigeria

GodwinPaya, CC BY-SA 4.0, via Wikimedia Commons

The Central Bank of Nigeria (CBN) has partnered with fintech company Bitt Inc. as its technical partner.

Bitt will help CBN to launch the planned digital currency, eNaira. Bitt Inc. took part in the development of DCash, a digital currency for Eastern Caribbean Currency Union.

According to the CBN governor Godwin Emefiele, eNaira will function “as a wallet against which customers can hold existing funds in their bank accounts.”

CBN announced its plans to launch a digital currency after prohibiting financial institutions from facilitating crypto transactions in February.

South Africa’s Reserve Bank Says Cryptocurrencies Are Assets Not Currencies

The governor of the South African Reserve Bank (SARB), Lesetja Kganyago, has stated that cryptocurrencies are assets, not currencies. According to Kganyago, cryptocurrencies only have two of the three currency qualities.

“A cryptocurrency is a store of value. It is a medium of exchange but is not generally accepted,” he said.

Kganyago also said that the bank is looking into crypto regulation to protect consumers. Many South Africans have been victims of the Mirror Trading crypto Ponzi scheme and the alleged Africryt bitcoin scam.

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