Bitcoin is one of the world’s first currency’s to operate without any central authority or banks. Instead, it cuts out the middle man and transactions are carried out peer-to-peer resulting in a much faster process.
Users of the currency are able to pay for products and services via digital Bitcoin wallets stored on their mobile device or computer and wireless transactions can take place by means of NFC technology.
The digital currency has the potential to completely change the way business and individual transactions are carried out and some companies are beginning to implement its uses. Canada has even installed the world’s first Bitcoin ATM.
Businesses and individuals can make and receive payments using the highly-secure Bitcoin network with next to no fees.
Additionally, the currency’s military grade security encrypts all storage and transactions making it the most secure, expedient and easiest way to carry out transactions.
The highly controversial and even more volatile currency that’s sweeping the globe is making some individuals wealthy and changing the way we think about currency.
It has the potential to revolutionise an emerging African market and the proof is already there.
Digital finance is transforming Africa in a big way. Companies such as Google, Visa and MasterCard are all entering the East African currency market, of which lately has seen a shift toward a more digitally controlled medium.
Recently, it was confirmed that a merchant payments aggregator secured a $2.6 million in investment.
You don’t have to look far to see the possible success these digital mediums can have by looking at Kenya.
Today mobile payment solution M-Pesa is used by 70% of the country’s population and moves around 30% of the country’s GDP each year.
There is currently a digital payment revolution happening with hundreds of start-ups across the continent clambering for a piece of the action as well as the aforementioned corporations.
Enter Bitcoin
So where does Bitcoin fit into this ever-growing financial landscape? Bitcoin overcomes many of the problems faced by current digital payment solutions.
The crypto-currency utilises a peer-to-peer payment method that is able to ignore government financial regulation, precisely the stumbling block of other digital payment methods such as Kenyan adopted M-pesa.
Due to this Bitcoin can reduce the cost of cross-border transactions by around 10%. Of course this figure will waiver due to the currency’s volatile value but this a concern for people holding onto their Bitcoins and not for those trading them.
“Ultimately this is about the customers in Africa’s emerging markets. Bitcoin has the power to transform Africa’s people from recipient’s to customers from followers to innovators and place it on the playing field of opportunity and entrepreneurship.” – Tunde Folawiyo, http://www.tundefolawiyo.org
The possibilities for Bitcoin are huge the world over and it seems strange for Africa to almost pioneer its use so early.
However, let’s not forget this is the continent that missed landline phones and went straight to mobile instead and because of this widespread mobile phone adoption, integrating payments such as Bitcoin seem obvious.