4 Ways Bitcoin Is Building African Prosperity

Embracing the Opportunities of a Powerful Tool

“Isn’t Bitcoin risky?” 

If you mention Bitcoin to someone in the West, there’s a high probability that you’ll hear these words. 

That’s because, for Westerners, Bitcoin is a speculative asset. That association only grew stronger after the spectacular collapse of the crypto exchange FTX. 

But for us Africans, Bitcoin means something entirely different. It’s not simply a matter of speculation. It's an opportunity.

Most people in the West don’t know what it’s like to live in a nation with weak financial institutions and, in many cases, chronically high inflation rates. They don’t know how many obstacles Africans face with something as seemingly simple as the flow of money. 

Bitcoin can change all that. It’s a valuable tool that is already raising Africans out of poverty, right now, in four critical ways: 

1. Decentralization of Authority

In order for entrepreneurs to create prosperity in Africa, they need the freedom to move capital freely because—duh—businesses often need to shift capital quickly and frictionlessly. 

But African entrepreneurs face extremely strict restrictions that prevent them from sending money abroad, making it nearly impossible to source materials from other countries. 

Bitcoin wins because governments can put no limits on it.  

That makes Bitcoin invaluable in nations with significant inflation and currency controls that prevent citizens from bringing capital in or out.

Bitcoin also offers a path to liberation from Western economic control. The CFA, a French-controlled currency currently used by more than 180 million people in 15 nations, requires people to deposit half their foreign exchange reserves with the French Treasury. That means African countries have to put a huge chunk of their money into France, while still having no sovereignty over their own economic policies. 

For Africans to have financial independence from the US and EU, Bitcoin is the only way forward.

Bitcoin isn’t controlled by any specific country or region. It’s a decentralized currency, which means that Africans can use it to build prosperity—not through speculation, but through a free flow of currency. 

 2. Sending International Money Transfers

With Bitcoin, Africans living in rural areas will be able to exchange money with people in other countries.Africans without access to a bank account will still have a way of getting money to businesses or their loved ones.

And if that doesn’t sound like a huge deal to you, let me explain just how huge it is. In 2021, only 55 percent of people in Sub-Saharan Africa had a bank account. 

That means nearly 550 MILLION PEOPLE live without the security of a bank account, credit cards, lending facilities, or the ability to transfer money. 

Bitcoin can change all that. It can give people access to the financial resources they need to prosper. 

3. Accepting International Payments 

Bitcoin also makes it possible for people to receive money from abroad. 

At the moment, Sub-Saharan Africa is the most expensive place in the world to send and receive money. In 2020, the average cost of remittances in Sub-Saharan Africa was twice as much as those to South Asia. 

And that’s if you’re even allowed to receive money at all. African entrepreneurs wanting to sell products abroad are often excluded by payment processors, preventing them from accepting international payments. 

Bitcoin doesn't judge you based on where you're from. It makes it possible to receive money from anywhere else in the world, without greedy intermediaries taking a huge bite out of the money you’ve worked hard to earn. 

4. Scalable Money Transfer Costs 

Imagine that you’re an African immigrant working abroad, and you want to send money to your elderly parents back in Africa. You have $1,000 to send, but because of fees, your parents only receive $730. 

That’s a huge amount of money for many African families. And for what? I promise you that the transfer company isn’t giving you hundreds of dollars worth of service to get your money where it needs to go. They’re just scraping a huge percentage off the top because they can. 

Meanwhile, Bitcoin transactions can be made with next to no fees, making every penny count. 

Bitcoin will allow us to leap over and escape dysfunctional financial institutions, and, in places where financial institutions are virtually non-existent, it will offer an alternative. 
—Magatte Wade

Here’s the big picture: 

Bitcoin won’t magically lower the cost of doing business in Africa. It won’t erase generations of oppressive regulations and liberate entrepreneurs from ridiculous government-imposed constraints.

What it will do is create more economic freedom while we fight for systemic change. Bitcoin will allow us to leap over and escape dysfunctional financial institutions, and, in places where financial institutions are virtually non-existent, it will offer an alternative. 

Bitcoin is an integral part of what I consider the “African Entrepreneur’s Toolkit.” By embracing its possibilities, talented Africans will chart an easier path toward becoming co-creators of global prosperity and innovation.