While cryptocurrency scams regularly make international headlines, there are still entrepreneurs determined to expand the possibilities of digital currencies to include more users.
It all started in November 2021. At that time, the price of Bitcoin had reached an all-time high. As it approached $60,000, it won over new followers, surprised by the sudden rise in value of a still poorly understood digital currency, and created new fortunes around the world. Like the rest of the global economy, the world’s leading cryptocurrency was enjoying a favourable economic climate, driven by the recovery in global trade. This was a far cry from today’s fears of commodity shortages, soaring freight prices and the war in Ukraine, which have subsequently caused Bitcoin’s price to plummet to around $20,000.
In Africa, many people invested in cryptocurrencies even before this upward trend in the value of Bitcoin. In Kenya, the consulting firm Chainalysis, which specialises in monitoring the development of the crypto sector, estimates that 8.5% of the population holds digital currency, 0.2 percentage points more than in the US.
According to the same source, 7.1% of South Africans also own a crypto wallet, as do 6.3% of Nigerians. In total, the firm’s experts estimate that between September 2019 and June 2021 the ecosystem grew by 2,300% on the continent. Enough to convince many project leaders on the continent to launch themselves in a sector that is still poorly regulated and reserved for a handful of pioneers. Here is an overview of the start-ups to watch, far from the scam attempts, flawed business models and other promises of dubious returns.
Founded by Nelly Chatue-Diop, a French-Cameroonian engineer with a background in telecoms, this start-up has developed a crypto wallet connected to mobile money services and also provides access to investment and savings. Based in Bordeaux and Douala since 2019, Ejara is reportedly about to announce its first eight-figure fundraising round after closing a €2m seed round in October 2021 with London-based investor Anthemis Group and fellow French startup CoinShares.
Is it a contrasting example to the Africrypt scandal? One thing is certain, this cryptocurrency asset exchange platform created in 2018 in Johannesburg by Farzam Ehsani, Theo Bohnen and Badi Sudhakaran is seducing investors and is now valued at $240m. In a second round of funding of $50m that closed in February, VALR, which claims 40,000 customers in South Africa, brought in California’s Pantera Capital and ten other international venture capital funds.
In the wake of its $23m seed round, this crypto exchange platform founded in 2021 by Chi Nnadi, Dearg OBartuin and Lucas Llinás Múnera has acquired the services of Susan Younis, former marketing director of Platoon, Apple’s artist unit.
Its board of directors also includes former executives of tech heavyweights such as PayPal, Uber and Amazon. The application is available in Nigeria and Kenya.
In Ghana, where banking and finance have already reached an advanced stage of digitalisation, Mazzuma is a pioneer with a solution connecting mobile money services to blockchain and artificial intelligence to enable transactions, bill payments and mobile data purchases without commission fees. Listed as one of the top 30 under 30 to watch by Forbes magazine, co-founder Kofi Genfi has chosen to issue 60,000 tokens of his own digital currency in order to develop cross-border payments between individuals via Mazzuma or a chatbot available on WhatsApp and Telegram.
The Africa Report