Across sub-Saharan Africa, Kenya remains a top player in technology development and adoption. The country’s innovative mobile money and micro-financing platform, M-Pesa, is internationally acclaimed for enabling seamless transfer of funds to the banked and unbanked population even across borders.
Along with Nigeria and South Africa, Kenya leads the region in cryptocurrency-related activities. In 2020 alone, Kenyans traded over $91 million worth of Bitcoin on online exchanges, ranking eighth globally. Only Nigeria had a higher Bitcoin trading volume in the same period across the sub-Saharan region.
A Non-Restrictive Government
The Government of Kenya has barely any regulations for Kenya’s crypto industry, and no clear signals point towards prohibition or reception of cryptocurrencies. However, Kenya’s Central Bank had previously issued multiple warnings to the public and financial institutions, cautioning them against transacting cryptocurrencies.
Judging by one of the latest remarks by the Governor of the Central Bank of Kenya (CBK), Dr. Patrick Njoroge, the regulator is seemingly changing its stance on cryptocurrencies. Dr. Njoroge revealed that Kenya had entered discussions with global Central Banks regarding a possible entry into the crypto space through Central Bank Digital Currencies (CBDC).
Growing Popularity among the Youth
Even with these cautions, Kenya’s crypto market has never been more vibrant. More people are learning about cryptocurrencies and joining the crypto space. The majority of the new crypto industry entrants are young Kenyans between ages 22 and 30.
In a country weighed down by unemployment, the youth rely on informal and self-employment opportunities to make a living. The crypto world’s highly volatile but steadily bullish markets have made it an attractive investment opportunity for many unemployed youths.
What’s more, Kenya’s young population is tech-savvy and always interested in new and emerging technologies. As of December 2020, Kenya had an internet penetration of over 85%, ranking top among all countries in Africa. Coupled with high smartphone penetration, this vibrant group is always up-to-date regarding the latest crypto news and other tech-related events.
Accessible Crypto Services
The bustling crypto market in Kenya would be nothing without access to crypto services. Kenya’s traders have access to many crypto trading platforms, most notably Binance, Coinbase, and Paxful. Binance’s peer-to-peer (P2P) trading, which previously supported crypto payments via M-Pesa, is one of the most popular ways for trading crypto in Kenya. The top exchange engages Kenya’s crypto community via its Telegram group. Paxful also has verified vendors through whom traders can purchase Bitcoin and altcoins.
The crypto community in Kenya organizes several events to share blockchain technology knowledge with interested individuals, learn together, and hear from industry-leading experts. Most of these meetings are held virtually, increasing their reach even further.
Finally
The CBK points out the potential for illicit financial dealings using crypto as a major red flag. Unlike Nigeria’s March 2021 crackdown on cryptocurrency trading, Kenya’s government has been fairly relaxed regarding this market despite the CBK’s warnings. The country’s crypto market is blossoming and direly needs supportive regulatory frameworks. This way, the industry will gain the trust and confidence of more people across the country to propel it to even higher heights.
References:
- https://kenyanwallstreet.com/cbk-in-discussions-over-digital-currency/
- https://paxful.com/buy/bitcoin/kenya
- https://www.statista.com/statistics/1195753/bitcoin-trading-selected-countries/
- https://qz.com/africa/1985223/nigerias-crypto-ban-has-startups-and-traders-in-a-frenzy/
- https://www.statista.com/statistics/1124283/internet-penetration-in-africa-by-country/
- https://t.me/BinanceKenya