From increased government and institutional participation to millions of dollars in crypto fundraising, the year in African crypto was far from dull. We walk you through the highlights, month by month. Bear in mind these highlights will definitely influence the crypto outlook in the continent in 2023.
January 2022: Binance sponsors AFCON
The year started off with Binance sponsoring the Africa Cup of Nations, continuing with its mission to spread crypto awareness far and wide across the African continent. A few years ago, a crypto company would never have sponsored anything, leave alone a continental tournament. Goes to show that the rep is really improving.
This was also the month the ₿trust board announced its plan to decentralize and fund Bitcoin development in Africa. Jack Dorsey announced the board in mid December 2021 whose duty is to find the best way to distribute 500 bitcoin towards development efforts.
February 2022: Crypto companies raise record millions
The month ushered in the flood of funding rounds that hit the fintech scene, including crypto. Nestcoin, a crypto startup in Nigeria raised $6.45M. We have always been a fan since they started Breach, an email newsletter pretty much doing what we had started doing then slacked off. Forgive us. 😁However, hold that thought as the year did not end so well for Nestcoin.
Another company that raised money this month was Jambo, an app we’re still not sure about and haven’t heard about since then. It raised $75M to build a web3 super app for Africa. Watching that space.
Yet BitPowr, another Nigerian company, launched to provide blockchain infrastructure to business. It went on to join 500 Global later in September which is great progress from where we sit.
March 2022: FTX partners with AZA Finance
VALR, this time from South Africa, raised a whooping $50M to expand across Africa.
Luno, one of the oldest crypto exchanges operating in Africa, launched an early stage investment arm, Luno Expeditions, to back early-stage fintech and web3 startups. Some of the ones that stood out for us in their list are Caliza, Busha, Kotani Pay, Nala and Stitch.
Finally FTX, which was then one of the most popular crypto exchanges in the world, partnered with AZA Finance, parent brand of BitPesa to expand web3 across Africa. This was great news then, with reports of an ongoing acquisition following throughout the following months. Hold that thought.
April 2022: CAR legalizes Bitcoin
The Central African Republic (CAR) apparently legalized Bitcoin. However, this was a shock move to everyone, given that CAR has never topped any cryptocurrency charts anywhere and has a very low electricity and internet penetration. Experts cited an ulterior motive — a protest against the CFA franc which many say is used by France to control the 14 African countries that use it.
While we are yet to hear more as to where this decision took the country or how practical it has been, CAR definitely made a name for itself by becoming the second country in the world to make bitcoin legal tender. El Salvador was the first in 2021.
Meanwhile, the Central Bank of Nigeria slapped three banks with fines worth 800M Naira for failing to ban customer accounts that transacted in crypto. CBN had issued an order to banks in 2021 advising them to close all customer accounts involved in crypto. The three banks affected were Access Bank, Stanbic and UBA.
May 2022: The Bitcoin dip
This is the month we began to see another big Bitcoin dip from the $40K regions to 20s. The biggest news came when Tether, the largest stablecoin, fell below its $1 peg in the middle of panic in the crypto world. Essentially this shouldn’t happen since stablecoins are supposed to be backed 1-to-1 by dollars held in reserve and any kind of panic withdrawals should not lead to a drop in price and liquidity.
Meanwhile, Mara, a crypto exchange, raised $23M while Jambo closed a $30M round just two months after its first. I remain highly skeptical of these “apps” that just keep raising and we don’t see tangible results out here months later. I will hold my tongue.
The Banking Commission of Central Africa (COBAC), the banking regulator in the Economic and Monetary Community of Central Africa (CEMAC) sent a reminder on its crypto ban. CAR, the same one that declared BTC legal tender in April, is a member state of this community. Interesting times.
June 2022: University students bitcoin theft
In June, there was a story doing rounds about KenGen offering excess geothermal power to Bitcoin miners. I have not heard anything further about this, despite my digging, so I will not dwell too much on it.
In other news, it seems we have not seen the end of bitcoin theft cases in Kenya. Apparently, two university students were hacking credit cards, buying bitcoins then converting them to Kenya Shillings to spend on a lavish lifestyle in Nakuru.
June is also the month that saw a continued drop in crypto prices yet again.
July 2022: Khaby Lame promotes crypto
The Central African Republic (CAR) continued in its quest to go crypto by launching their digital currency, Sango Coin on July 3rd. However, it did not attract as many buyers as would normally be the case in an initial sale of a token, selling $1.09M of the initial $21M available in the first hours. How is Sango Coin doing now? In December, CAR announced it would delay the listing of the coin on exchanges due to market conditions.
July is the month in which Binance continued its big marketing efforts by signing Khaby Lame to promote crypto awareness in Africa. Other than that, July was understandably a quiet month given the approaching crypto winter.
August 2022: Ethiopia to register crypto companies
Meanwhile, Ethiopia’s Information Network Security Administration (INSA), the agency regulating Ethiopia’s cyberspace, began registering crypto service owners and transfer providers in the country. Contrary to the initial ban on crypto a few months earlier by the central bank in Ethiopia, this move indicated the government’s interests in the industry, similar to many other governments across the continent.
September 2022: Crypto events month
We can legitimately call September the month of crypto events in the continent. From ETHSafari in Kenya to the Africa DeFi Summit in Ghana, web3 enthusiasts were treated to many networking and learning opportunities despite the market conditions.
ETHSafari focused on celebrating the ethereum ecosystem by bringing together players in Africa and across the world down to Kilifi, Kenya.
The Africa Money & DeFi Summit in Accra, Ghana, hosted by AppsAfrica, a leading event organizer in the tech space, connected industry leaders from the African fintech and crypto ecosystem.
There was also a Women in Crypto meet in Nairobi and Accra to bring together women building in Africa. This was hosted by the new Women Who Build Africa community led by Thea Sokolowski of Stitch and Gwera Kiwana of MFS Africa.
Crypto exchange Yellow Card closed a $40M Series B funding round in its continued expansion across the continent.
October 2022: South Africa declares crypto a financial product
We can call October the calm before the storm. You will see why shortly, in case you missed the news somehow.
It’s important to mention that South Africa made its stand on crypto regulation clearer in a notice published in October by the Financial Sector Conduct Authority (FSCA) declaring crypto assets a financial product. This automatically brought crypto exchanges under FSCA’s regulatory jurisdiction, a welcome move if you ask me. Noone wants to continue living in the uncertainty that can breed chaos for crypto startups in Kenya, for instance.
November 2022: FTX causes mayhem
Enter the month when all hell broke loose.
Remember FTX from our March entry? Well, one November evening, interesting tweets by its founder and CEO, Sam Bankman-Fried, also known as SBF hit our timelines. What a name, right?
Anyway, SBF assured people that despite the stories that had now picked up steam about FTX’s liquidity problems, Binance had come to the rescue to acquire FTX. CZ, Binance CEO, confirmed the story. Barely 24 hours later, that deal was off. Another few days later, FTX filed for bankruptcy and SBF resigned.
The domino effect was epic, tumbling all the way to Africa. One of crypto’s flag bearers in the continent, BitPesa A.K.A AZA Finance dodged a huge bullet. Remember the partnership announcement it made in March? FTX listed all AZA Finance in the bankruptcy filing. AZA Finance CEO, Elizabeth Rossiello, refuted claims of acquisition and assured everyone that it was not part of the FTX drama. It could have been worse.
One of the other crypto companies to come out and cite the FTX fall for its own actions was Nestcoin. Remember its funding raise in February? Alameda Research (FTX) was part of that fundraising. In addition, Nestcoin’s CEO, Yele Bademosi, said that they held assets now stuck on FTX and thus had to lay off employees. Let us not forget all the individual customers who had their funds on FTX. This was a result of its massive marketing in various African countries selling crypto as an inflation hedge.
In better crypto news, Pick n Pay, a leader in the South African retail space announced that it would let shoppers pay for purchases in bitcoin. The pilot is testing the Bitcoin Lightning Network which has lower transaction fees and faster speeds compared to the main bitcoin network.
December 2022: Bitcoin mining in Kenya gets a boost
The crypto winter continued with SBF’s arrest and more revelations and speculations.
All the same, this was the month Jack Dorsey came to Kenya and the who’s who in the tech space had pics posted all over socials after meeting him at an exclusive event at iHub. It’s against this backdrop that bitcoin mining company, Gridless, raised $2M in a round led by Stillmark and Block, Inc. Jack Doresy is the face of Block as co-founder. According to the press release, “Gridless designs, builds, and operates bitcoin mining sites alongside small-scale renewable energy producers in rural Africa where excess energy is not utilized.” We are definitely watching this one.
2023 has already started on an interesting note with bitcoin and other coins rebounding. Time to buy? Will we see higher prices in the currency global recession? Some pundits predict that we will not see any more highs until 2025. We know someone who wants to put in a million into something like DOGE and reap in a few years to take his kids to St. Andrew’s Turi. LOL. This is not financial advice.
Let’s wait and see.