Bitcoin South Africa 2022

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Bitcoin South Africa
The rise of cryptocurrencies took the world by storm including South Africa and Bitcoin South Africa Trends are becoming clearer by the day. It is a known fact that South Africa is the most economically advanced country on the continent even though it is not the largest economy (that mantle is held by Nigeria). However, the dynamic nature of the South African economy makes it a fertile ground for the widespread use of Bitcoin as a means of exchange and a store of value. Today, the country has become a hotbed for crypto assets and is pushing the frontier of its deployment in the continent.
According to the data released by different analysts, the general consensus is that South Africans transact crypto assets to the tune of over $2 million dollars monthly and in some peak periods, this figure could be twice that. After government regulations increased foreign transactions in crypto assets beyond R1 million, there was an upsurge in digital asset trading in the country at the start of 2022.

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Growing technological literacy about Bitcoin South Africa

In South Africa and other advanced countries like Nigeria and Egypt, there is a growing level of literacy about Bitcoin and other digital assets. This growing knowledge has made more people accept the asset. The growing interest is keenly felt among the younger population of South Africa.

Even more evident is the fact that when you review Google search trends, you will see that the country ranks fourth in the world for global searches of the word “Bitcoin”. This interest is gathering steam by the day and points to even more widespread acceptance in the coming years.

South African Bitcoin Guide

The trend has almost opened up even more opportunities for people across different economic and age brackets to tap into the limitless riches that Bitcoin and digital assets in general offer. Furthermore, the adoption of ingenious Blockchain technology in South Africa has made the country an attractive destination for investors who want to increase their holdings and profit margins.

A rise in peer-to-peer platforms

One example to show that Bitcoin in South Africa is gaining traction is the rise in the number of peer-to-peer platforms active in the country. These platforms make the process of buying and selling Bitcoin a lot easier. These platforms simply help buyers and sellers bypass government limitations. Rather than buy and sell directly, traders trade on decentralized platforms and then send and receive South African Rands with their local bank accounts.

Bitcoin peer-to-peer network

Many analysts believe that the rise of these platforms has been a major catalyst in the widespread adoption of Bitcoin in South Africa. Due to the decentralized nature of Bitcoin, many see it as an efficient and reliable currency. The Blockchain technology of this asset and many others also makes it an attractive medium for many to store their wealth. So, therefore, investors classify it in the same bracket as precious metals like gold. Suffice to say that Bitcoin has become a viable investment asset for small, medium, and large scale South African investors.

A breeding ground for virtual money

Today, South Africa has become a breeding ground for virtual money. And there are reasons for this. Firstly, many South Africans feel economically marginalized; they believe that they are locked out of the financial systems of their country. The non-inclusive nature of South African finance has been one of the banes of the common man. So while citizens of European countries may not be too keen to invest in Bitcoin since they already have advanced stock markets, many South Africans do not have that kind of access.

But Bitcoin in South Africa offers them access to trade not only this asset but other digital assets like tokens and NFTs. With Bitcoin, they can bypass regulations and border limitations to trade in hundreds of tradable assets with their phones. This is aided by no small measure by money transfer companies that are currently active in the South African finance industry. So you see, the alliance of peer-to-peer platforms and technological money transfer companies has opened up access even more. Amazingly, there are South Africans in the hinterland who trade Bitcoin today.

Telecommunication access, a money store and a phone

Young South Africans today don’t need a degree in Forex trading to trade Bitcoin. Neither do they need to live in big cities with access to banks. In rural Soweto, there are hundreds of young adults who live off the digital market. As long as they have a phone that can browse the internet and there is active internet broadband in their location, they can watch tutorial courses online on how to trade digital assets.

Once they earn income from their activities they can withdraw such funds into their local bank accounts and withdraw the same at the nearest ATM or send the funds to a local money transfer agent’s account who will then give them the raw cash.

How to buy bitcoin in South Africa

The most common way of buying bitcoin in South Africa is by using the cryptocurrency exchanges. The most famous Bitcoin exchanges are Kraken, Binance, Paymium and Bitstamp. You can also buy other cryptocurrencies there – there are more than a thousand besides Bitcoin.

But beware! When buying, you should always keep in mind that bitcoins could theoretically lose their entire value from one day to the next.

It is also possible to trade bitcoins with other people outside of these exchanges by using cypto brokers. In this case, the buyer and seller exchange the exact amount that the seller is willing to sell it for, then. This time, though, you should know how much a bitcoin is worth in order not to get scammed.

How to invest in Bitcoin in South Africa

In the meantime, not only private individuals are buying crypto coins in SA, but institutional investors have also found out about digital currencies. Many of them invested their money in Bitcoin and Ethereum, two of the most popular cryptocurrencies at the moment. They make up about 60% of all digital currencies in the world by total market value. No wonder, then, that almost every place where you can trade virtual currencies has Bitcoin and Ethereum in its repertoire. This is why. Even though the two can be bought on every crypto platform, there are huge differences between the places where people trade them. There are people who sell real bitcoin.

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Factors influencing the widespread adoption of Bitcoin South Africa

There are so many factors influencing the widespread adoption of Bitcoin in South Africa and here are a few of them.

Avoid currency instability

In recent times, the South African Rand has been unstable and susceptible to inflation even before the coming of Covid. This created a lot of uncertainty among the locals who may see the value of their money worth a particular value today and then watch it drop in value a few days or weeks later.

Even though Bitcoin has witnessed high volatility in recent times, many people still consider it to be a much more stable currency than the Rand. So they prefer to hold some of their wealth in Bitcoin. Also, when you consider the mismanagement of the monetary policy by the authorities, many more people are placing less trust in government controlled assets.

Easy way to send money home

South African citizens in the diaspora send billions of dollars annually to their friends and relatives. This has been ongoing for years but not without delays and limitations. But Blockchain technology represents the easiest way to do it today for those who want to transfer money in time. They can send money from their base and the recipient will receive it in a matter of minutes wherever they may be.

Low transfer cost

Besides the need for speed, the cost of bank transfer can be astronomically high so many in the diaspora end up losing as much as 10% or more of their money just to send money back home. But with Bitcoin, they can practically send money home for free since the deduction is mostly 1% or less. Skipping the cost of conversion rate remains the biggest attraction to Bitcoin.

Unemployment

South Africa has long had a massive unemployment crisis with many young people leaving school with no economic opportunities to exploit. Their bleak prospects have caused many to turn to cryptocurrency trading as a get out of poverty-free card.

Due to the free entry and exit opportunities cryptocurrency offers, many people are now actively trading Bitcoin for a living. It is no small feat to note that there are currently thousands of cryptocurrency traders in South Africa. While there were only a few thousand traders of these assets only a few years ago, a larger number of people now trade them online.

How Government regulations have impacted Bitcoin in South Africa

Initially, there were no regulations on Bitcoin and other digital assets in South Africa but all that changed after the government enacted the Anti-Money Laundering law (AML). While this regulation did not place an outright ban on cryptocurrency trading, it introduced certain restrictions. The South African Reserve Bank also granted access to some private sector entities to experiment with the currency under close supervision. But why is the government keen to restrict Bitcoin use? For three major reasons.

Control cash outflows

Governments all over the world are more interested in how much leaves their shores than how much comes in. This is because they can track where the money goes within their domain but cannot do so once it leaves their shores. The ability to track and control money flow is one of the monetary tools used by the government to buck up the economy.

Check money laundering

Another reason why the government is so keen to limit the use of Bitcoin is because of the fears that it can be used as a vehicle to launder money abroad. Since Bitcoin uses encrypted technology that the government doesn’t control or have access to, they cannot determine who is funneling what funds where. It is however important to note that South Africa is not the only country whose government has these concerns. Other world governments and international financial institutions have shared these concerns as well.

Protect citizens asset

One of the fundamental responsibilities of government is the protection of the lives and properties of its citizens. In light of growing security risks associated with fraudulent third-party sites in the crypto-verse, these limitations are being put in place to protect citizens from loss.

Despite these concerns, there is nothing like an outright ban on Bitcoin in South Africa like we have seen in other African countries. It is still traded within the parameters of the South African financial system. From all indications, this will continue to be the case heading into the future.

Inflation will trigger a rise in Bitcoin use

The current inflation experienced by South Africans is eating deep into their pockets so the growing number of people turning to the use of Bitcoin is only going to increase. This is a trend noticed in other countries and the same will be the case in South Africa.

Analysts believe there the embrace of Bitcoin is directly related to the inflation statistics in the country. People want an asset they can use to hold on to their meager wealth. If they are not convinced that the local currency can offer them that, they are bound to turn to Bitcoin instead.

The future of Bitcoin South Africa

Bitcoin South Africa has a very bright future. It is a very easy asset to buy, sell or hold and the technology is highly secure. This reality coupled with inflationary trends in the country will see a non-stop growth in its usage. Already, we are witnessing the rise of stablecoins like USDT which is a digital token pegged to a dollar.

The new payment and investment opportunities offered by Bitcoin and Blockchain technology are only going to attract even more following in South Africa. Despite the fears and uncertainties of the currency, the fact that there are far more opportunities in store will only serve to drive Bitcoin South Africa even further.

Bitcoin South Africa FAQs

What is a Bitcoin?

Bitcoin is a decentralized digital and virtual currency. The technology behind it is the so-called blockchain. It protects the new transfer system from manipulation. Due to the decentralized way of working, it also escapes the control of states or banks – the legitimacy of a transaction with Bitcoins is taken over by the users of the network.

Is Bitcoin legal in South Africa?

Yes, Bitcoin is legal to buy, sell and trade in South Africa. You just have to go with a reputable exchange, fortunately in this article, we have discussed about how to buy bitcoin in South Africa safely online.

Is Bitcoin a centralized or decentralized currency?

Bitcoin is a decentralized cryptocurrency.

Does the government of South Africa control Bitcoin through the Reserve Bank of South Africa?

No, it doesn’t. Bitcoin is a decentralized currency that is not under the control of any world government.

How old is Bitcoin?

Bitcoin as an actively used and traded currency is 13 years old.

How many Bitcoins can I hold?

You can hold as many Bitcoins as you can afford.

Where do I keep my Bitcoin?

Bitcoin ls are stored in a secured digital wallet with authenticated passwords.

Is the price of Bitcoin static?

No, it is not. The value fluctuates in line with the forces of supply and demand.

Can I use Bitcoin to transfer money into and out of South Africa?

Yes, you can use it. Its secure Blockchain technology. Blockchain technology is far more secure than the security architecture of modern banks.

Conclusion

As the rest of the world continues to explore digital assets and their technology, the investment in crypto assets in South Africa will continue to gather steam. With a robust infrastructure and tight security, many hope that Bitcoin South Africa will create even more economic opportunities for South Africa’s teeming youth.