In South Africa, Bitcoin adoption is starting to pick up the pace.
In South Africa Bitcoin is very much still an emerging market. However, that is starting to change.
Citizens have been enduring massive inflation for years now and have been searching for something, anything, as a means of protecting their wealth.
Here is a chart of the South African Rand against the US Dollar over the last 5 years:
Not a pretty picture, and it's even worse when you look back at the last 10 years. Basically, anyone who has held their money in a bank can purchase less than half of what they could purchase just a couple years prior with the same amount of money.
Enter Bitcoin
Currently there are about 100,000 users on the two main Bitcoin exchanges, Luno and Ice3X. That is not a large number but that number has been increasing rapidly over the last year or so.
Citizens are flocking to these exchanges as a means of preserving their wealth and to be a part of the current Bitcoin boom, or Bitcoin gold rush as some are calling it.
The Luno Marketing Officer, Werner Van Rooyen, said that it isn't just about new users signing up for the exchanges, but instead it is that Bitcoin overall is becoming more mainstream in South Africa.
"We see it in many ways,"
According to Van Rooyen...
"Not just from our own internal metrics, which include new customers, active users, application downloads, trading volumes and interest from banks and institutional investors - but also from other places: trading volumes that keep growing, increased merchant adoption, increased understanding by investors, regulators and banks, press coverage, and also the number of Google searches on Bitcoin."
Adding to that, The South African Reserve Bank also just announced that it would be starting a Bitcoin regulation experiment via a "sandbox" setup through a blockchain-based solutions provider called BankyMoon.
More about that can be read here:
https://cointelegraph.com/news/south-african-central-bank-to-start-bitcoin-regulation-experiment
Why the need for Bitcoin?
As mentioned above, South African's are getting hurt by inflation. Every year any money that they are holding is able to purchase less and less.
Political turmoil has been a major reason for this. The country was also just recently downgraded to Junk Status in terms of it's credit rating by the rating's agencies Fitch and S&P.
There are constant reports of corruption at the highest political levels and fighting amongst political parties which all negatively affects the value of their currency.
Bitcoin offers a hedge against that downward sloping local currency. Bitcoin is volatile as well, but over the years it has a predominantly upward bias vs. the Rand's downward bias over the same time period.
Van Rooyen noted:
"When there is a nosedive in, say the exchange rate for the Rand, you'll often notice a downtrend in other industries like the stock market or the housing market. Bitcoin has been found as one of the assets with the lowest correlation to other asset classes."
Which means South African's have few other options.
More than a store of wealth?
Currently the best use case for Bitcoin in South Africa is as a store of wealth, however, that isn't it's only use...
South African's biggest online retailer Takealot, accepts Bitcoin. Takealot is basically their version of Amazon.
Takealot's Chief Marketing Officer, Julie-Ann Walsh had this to say regarding Bitcoin payments:
"When we launched the Bitcoin payment option in 2014, Takealot was one of the first South African online retailers to allow customers to transact using Bitcoin, which then accounted for just under .1% of all transactions. While this is still a very small portion of our overall sales, the number of Bitcoin transactions has increased year on year since launching the service and from 2016 till now we have seen a 170% increase year on year in Bitcoin transactions."
Bidorbuy, has also been accepting Bitcoin. Bidorbuy is basically their version of eBay.
Heck, even the Nelson Mandela Children's Hospital Fund takes donations in Bitcoin.
As you can see, Bitcoin is a useful store of wealth for citizens in South Africa, but as time goes on it is quickly becoming MORE than just a store of wealth in South Africa.
Stay informed my friends!
Sources:
https://www.xe.com/currencycharts/?from=ZAR&to=USD&view=10Y
https://cointelegraph.com/news/south-africans-make-bitcoin-work-for-them-as-currency-store-of-wealth
https://cointelegraph.com/news/south-african-central-bank-to-start-bitcoin-regulation-experiment
Image Sources:
Follow me: @jrcornel
Very nice.
Congrats to all South Africans , S.A gov take a smart step ,
Agree SA is stepping up if you like money have a look at this hack https://steemit.com/introduceyourself/@bitshack/post-that-make-money-is-this-true-wow
I imagine they are anxiously awaiting the results of their "sandbox" test.
I wouldn't go near BankyMoon, the whole point of crypto is to be anon.
Bitcoin is open source. If you want anon, go Monero
can you vote me ?
Sorry to say but they have never taken a smart step. Goverments like this are usualy clueless about tech.
That's interesting to hear about the adoption of BTC. Hopefully diversifying into other areas will hedge buying power.
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I'm not sure that bitcoin qualifies as a store of wealth just yet. In my view, it's still too volatile. How can something that drops in value by over 25% in under a week be a store of value? Hopefully after the whole scaling debate is over, things will settle down.
I agree bitcoin has the potential to be an excellent store of value and should help people in high inflation regions but at present the volatility is just too high.
I think if your currency declined 50% against the USD in the last 5 years, you would prefer a currency that appreciated 2000% in the same period. Even if it has price swing of 20% in a week
and for all those Gold bugs. South Africa having lots of gold did not help
https://en.wikipedia.org/wiki/List_of_countries_by_gold_production
Will Gold ever get it's place in the sun again?
Yes, when hyper inflation comes
I think cryptocurrency is taking its place now as a safe store of value
This is the point of this article. A country rich in gold is turning to cryptocurrency instead gold to store wealth
Yes, we are moving on with technology. Gold might come redundant in the future. Even oil too.
Oil is going down. I believe we are beyond Peak Oil already.
That is why OPEC is not cutting supplies and USD is tanking
https://en.wikipedia.org/wiki/Peak_oil
Gold will always be here. To be used by central banks and people without computers or smartphones
In the long term I agree but it depends how often you need to use it. If you need to spend your wages on rent for example and they are worth 25% less today than yesterday, that is a real problem!
yes, its easier to convert bitcoin back to rand when needed than to convert gold to fiat money to pay your bills
Agreed that the volatility is not reassuring. However, in respect to a South African mindset Bitcoin sure seems like a plausible store of wealth. Especially when you take into consideration what has happened in neighboring Zimbabwe where $100 Trillion bills became the rough equivalent $1 USD.
If I were a South African, I'd sure sleep easier at night knowing I had some portion of my savings in Bitcoin. It sure seems like once awareness of Bitcoin/crypto reaches the far corners of the world (and with it internet access), everyone will be inclined to allocate at least some portion of savings towards the space. Just my two cents!
If value is not at all tangible and is based on a belief system then value can be stored in just about anything. the only reason gold price seem to have stability is because it is centralized, controlled and in the hands of a few. Bitcoin is a lot safer to hold than most if not all government currencies that exist today.
If the government fucks up the currency goes down and the community belief system that gave the currency value goes with it.
bitcoin has no government to fuck up the belief will fluctuate so will the value and so will the price. bitcoin is gonna be around for a while
Nope, just miners and developers arguing over what is best for it ;)
Good point. I think in this situation everything is relative. When you have a local currency that has dropped by 75% in the last 5 years, Bitcoin seems like the more stable option in comparison, even if it does have nauseating peaks and valleys.
If you apply regular smaller purchases at what seems a low spot, with a buy and hold strategy, the Rand cost averaging could take advantage of the volatility. That's what I'm doing anyway.
Great to see SA come to the party. It is unfortunate that Bitcoin got a bad name in 2016 in SA thanks to MMM. Some people in SA still think MMM and Bitcoin is the same.
Its all about the bitcoin!!! store of wealth forever and a day, stops value destruction due to the fixed supply of BTC.
Cryptos all the way.
Keep steeming like no other @jrcornel such an informative post.
That is the hope. I wonder if that limited supply will hinder it's use as a global currency though?!
Thats where verium eos and ethereum come in...
I dunno @thecynic think Bitcoin still has a long way to go and will increase in price dramatically.
I can't see supply being an issue, the value will just increase. With a 100 000 000 'satoshi's' (smallest unit) in each Bitcoin there are 2 100 000 000 000 000 units that can absorb value over the eventual Bitcoin supply.
@jrcornel
it's crazy to see south Africa , use bitcoin mostly Mandela fondation taking bitcoin
it's juste great way for them , to be able to use parallele economy system
Thanks for sharing
Upvoted ;)
Peace
@geemo-from-paris
Good news @jrcornel. Cryptos seems to be an answer to our dwindling S.A. economy. Resteemed
Great history lesson, quite an interesting topic there. You really spent time doing your research. Steemit is such a great platform to learn about so many different things, its amazing. Thanks for posting and keep up the great work!
Hi jcornel let me ask you something again how do you find this knowledge? you must be in finance or something? I am trying to come up a little myself but its tough can you share any pointers on btc for me? :0)
I'm not surprised, many people from nations that have unstable economies can only gain from crypto. While the crypto market maybe unstable in itself, it always bounces back, that is something that many of the third world currencies cannot promise. Crypto can also be changed to USD, the de-facto global fiat world currency or because quite a few other fiat currencies like Euro etc. This allows for some degree of monetary conversion in the event that your country is low on foreign exchange.
Good points. If we could somehow turn off the ICO flood or at least limit it.. that would be great.
I listened to a talk on this subject (the ICO flood) and what the chap said, is it's similar to the dot com startup bubble. Everything is being tested, every niche is being tried every service is being coined. Eventually the truly useful will survive and flourish, and offer massive gains. The crypto investor is suggested to pick a massive niche and study the ICO's. Invest in what you know. I would choose something like Gaming and Casino tokens to research as that is my knowledge base.
The market will fund the growth of the crypto-verse and the market will choose the winners. Uninformed emotional buyers will be fleeced.
Great to see the increased adoption of Bitcoin in South Africa. I was so glad to attend when Andreas Antonopoulos came to the Blockchain Africa expo that was held earlier this year, that man is a Crypto Maestro. He makes the most technical aspect universally understandable.
Here's to South Africa and many other developing nations finding out about Bitcoin sooner rather than later, and may those people who are new to it embrace it because it is the future!
Imagine when a country like Kenya, who has 40% of its GDP stemming from Mpesa (who is owned by western union and charges the poorest people in the World over 20% a transaction) find out about Bitcoin and the fact that they can send money abroad in the form of foreign remittances for only a few cents! I love being a part of this disruptive ecosystem that is re organizing everything by simply making what doesn't work for the majority obsolete!
Bitcoin is a hedge against chaos! What a smart bet in this (or any) day and age
good post mate @jrcornel thankx for sharing hello steemians i will be happy to share with you and with all steemians this very interesting post the REWARDS POOL https://steemit.com/steemit/@upbuzz/understanding-the-steem-rewards-pool
Good one, i request you to post many bitcoin related news or articles
I shall grant your request.
Great... good news to hear.. thanks for sharing..
Is it a jock...77$ in 2 mint..
I cant earn much in 4 month
its reality people with more steem vote power easily earn money, so you need to deposite money or gain yourself steem power from hard work.
Yes, it takes time to build up a following and a brand on here. It can be done with a lot of work and persistence though. Investing some money helps as well.
BankyMoon... top kek.
The end of central banking.. praise kek
Great story, it wouldn't surprise me if this trend continues as more people in South Africa get acces to the internet.
Yea, I think they are buying more than just Bitcoin. There has been an uptick in steemit traffic in south Africa as well as Nigeria lately.
Interesting
Interesting. SA needs more free internet so masses have better access to it to use crypto.
If I lived in a third world nation, ALL of my money would be in bitcoin. Liquid currency immune to the craziness of your specific political system? Sign me up.
Yep, same here. I imagine we aren't the only ones thinking that way... :)
Thanks for the article @jrcornel. The issues you describe in South Africa are common around the world. Just take a look at the USD and it's steady decline of value over the last 30+ years.
The more money introduced into the economy, the faster inflation devaluates the currency. With Bitcoin there is actually less coin available every year, despite the thousands of miners producing more coin, because more people see it's true value and potential and don't want to sell it. People are starting to really horde BTC's and its only making the price stronger.
Yep I see that as well. However, that reason might be why it never catches on as a currency but instead is more like digital gold. For a currency to be useful you don't want people hoarding it, you want them spending it freely...
This is why we will see such a huge adoption to crypto currencies worldwide. Every currency will become more and more inflated.
Exactly. And as the government over there destroys the Rand, the flight to safety will begin in mass.
Also, as the government kills off major economic producer (the Boer), the Rand will continue its decline.
I'm not taking sides on the issue of SA politics. But it's not hard to predict that if you kill off part of your economic engine, your currency will pay the price for it.
I wonder if this "sandbox" test is partially to see if they should adopt some form of virtual currency in it's place?! ;)
I doubt the government is that strategic.
The Afrikaner, on the other hand, has figured out Bitcoin is usable. They're already on YouTube talking about it.
This is the beauty of crypto! Thx for sharing @jcornel. Resteemed
The adoption is spreading and feels like we are at the start of a snowball effect. If we can only get past this segwit/HF issue...
Yep. The next couple days could get pretty crazy...
Information that is worth a re-steem, very nice share @jrcornel...Africa+Bitcoin hmmm Mainstream!
This could really set a trend for other countries that are fighting inflation! Excellent post, @jrcornel
Going to Upvote and resteem this!
Thank you. Yes, there is certainly a lot of potential in places where inflation is raging out of control.
Two-Minute Guide On Bitcoin And How It Works In South Africa
https://t.co/7fuoDPegi2?amp=1
Good news! Upvoted.
The more I study it the more the whole thing looks like BS. Can't put my finger on it yet but I smell a rat. Nothing that I have ever seen in this society is random. They own and control us no matter what people are thinking.
i just hope cryptocurrencies will be legal all over the world, and in every country it will be used , not like right now we all store our money on us dollar or euro.
Upvote me @maulanailham Thanks!
I live in South Africa and I did not even know all that are sharing, thanks for the info.
Don't worry, not even the Gurus can keep up with all the new crypto info. lol
its all about the bitcoin ok i voted you
wellcome to my bolg @farhannaqvi7 :) always be happy
Ya know, this just made me think of the ripple effects of crypto.
For instance, the housing market in Florida receives alot of demand from Chinese money as people there just want to get their money into the US to protect it, they don't care if its a good real estate deal or not.
Crypto (depending on the coin I guess) could give them a safe haven effect as well (particularly hard wallets). Thus money going there rather than other places like US real estate.
Yes good points. The money flooding into the crypto space over the past six months almost looked like that to some extent. Everything was getting bought with little regard to the price or it's fundamentals.
Thank you for providing great content on steemit.we always enjoy every reading of your article @jrcornel
Thank you very much for those kind words!
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please upvote my essay..
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Good news for all ! Congratulation guys !!
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In all "third world countries" the future of crypto is bright !
wooow. That's a great move there...I just hope even the general public will adopt it too.
Yes, that is the final hurdle for all of these things. We are probably a ways away from that, at least in the US.
congratulations
I'm upvoting your post and sending your link to all my friends in South Africa who haven't discovered Bitcoin yet.
Awesome. Thank you! Tell them about steem and steemit while you are at it ;)
Bitcoin = Gold 2.0 maybe that rush to the save haven is also the cause for the pattern anomaly we see currently (oscillating Bitcoin price around all time high since 2 month never happend before, it was one month max) combined with the legalization in Japan and upcoming South Korea.
If i discuss the topic with users on steemit some don't give Bitcoin a chance in the future because of the aged technology. But is that true? What happens at the end of the year the Segwit adventure is over? Is Bitcoin stronger than ever or get just a short reprieve?
If i look at the trend you show Bitcoin is far ahead of the competition today from the marketing perspective. It has a long journey behind until it has reached such a market penetration. What happens wenn EOS, Ethereum and others reach the adoption by a early majority (Ethereum already has)? What happens to the Gold 2.0?
Currently i see just positive signs for original cryptocurrency beside the Segwit debate. Exciting times!
As I understand it. Bitcoin cannot be regulated. The banks have had years to try and regulate. Will have to wait and see. South Africa as is the rest of the world are now waking up from their Dreams! The future looks good!
Great article, yes I am a resident of SA and we experience and see the devastating effect of the declining Rand firsthand in our town. Luckily we were introduced to Crypto's about 18mnths ago and by mining BTC now , we can actually use some of it for every day expenses. The rest we use to purchase gold( wich is the ultimate wealth protector for me)
It is always excellent news to hear about other countries getting involved. The one thing I impress on people when I talk about steemit is that it is the first True global social media site. Sure places like facebook and twitter have people from all over the world, but not in a way where they're all talking to one another like they are here.
And speaking of South Africa, there's a new addition to steemit from there- his name is Zane @enazwahsdarb, and he posts excellent content, very well thought out and highly positive and encouraging.
I hope your beautiful wife, daugher and step-son are well! (still look forward to an update on them at some point, love to see faces :)
What a time to be alive... It is amazing to see the rate of innovation and adoption that we see today... Keep up the good work, very informative!
...and the SA citizens are using the cell411 app in droves take back the streets from crooked police and others questionable people! Keep pushing on SA, maybe I'll see you again someday!
Great article! Education about the crypto-currency market is vital for a more widely spread adoption here in South Africa. I think Steem is a great platform for spreading the word. So stoked to read an article about SA written by a South African
Nice to see fellow South Africans on Steemit, I only recently got into it. Which is the best sites to buy Bitcoin in South Africa?
Hi Chris please check out Luno