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South Africa’s FIC Unveils Draft Directive for Travel Rule Implementation; Crypto Industry Leader Issues Warning
The South African Financial Intelligence Centre recently issued a draft directive calling crypto-asset service providers to implement the Financial Action Task Force’s (FATF) travel rule. However, key figures in South Africa’s crypto industry say several factors could hinder the implementation of the FATF’s Recommendation 16. CASP Interactions With Unhosted Wallets The South African Financial Intelligence […]
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Africa-Focused Crypto Exchange Yellow Card Bags Africa’s ‘Disrupter of the Year’ Award
Yellow Card, the Africa-focused crypto exchange, recently won the African financial industry’s 2023 “Disrupter of the Year” award. The crypto exchange’s CEO described the award as a recognition of Yellow Card’s role in “solving important, practical problems across the continent for businesses.”
Award Reserved for Businesses Demonstrating ‘Resilience in Complex Times’
In what has been described as a first for a crypto company in Africa, Yellow Card, the Africa-focused cryptocurrency exchange, was recently awarded the financial industry’s “Disrupter of the Year” award. To win this year’s prize, Yellow Card, which is headquartered in Nigeria, beat investment platforms Bamboo and Ejara, financier Sparkle, and payment platform Moniepoint.
Join us to welcome the newest addition to the Yellow Card team!
We've just bagged the prestigious "AFIS Disrupter of the Year Award!"#AFISAWARDS #DisrupteroftheYear #GoCryptoWithYellowCard pic.twitter.com/5qp9A8QgCv
— Yellow Card App (@yellowcard_app) November 17, 2023
According to the Africa Financial Industry Summit (AFIS), the recognition given to Yellow Card at this year’s event is reserved for “a young company that has demonstrated resilience in these complex times and whose innovation represents a market disruption.” In addition, the award-winning company’s activity should have increased significantly in the year under review.
Chris Maurice, the founder and CEO of the crypto exchange, said the award vindicates his firm’s stablecoin bet.
“This award is further validation that our team is solving important, practical problems across the continent for businesses. We have come a long way for a stablecoin company to win a traditional finance award voted by judges who are all bankers,” Maurice explained.
The five-member panel which adjudicated this year’s award reportedly included the director-general of the Central Bank of Mauritania and the head of innovation at Ecobank. According to a report in The East African, the recognition of Yellow Card by AFIS could be a turning point for the digital assets industry not just in Africa, but globally.
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Study: Sub-Saharan Africa’s Bitcoin Transaction Volume Number One Globally, Data Indicates Shift Towards Stablecoins
Despite accounting for just 2.3% of global transaction volume, the latest data shows that crypto has penetrated key markets in Sub-Saharan Africa and “become an important part of many residents’ day-to-day lives.” With a regional volume of 9.3%, Sub-Saharan Africa’s BTC share outranks all regions including North America (9.0%) and Eastern Europe (8.2%).
Nigeria Epitomizes Sub-Saharan Africa’s Crypto Penetration
While the Sub-Saharan Africa region is reported to have accounted for 2.3% of global transaction volume, a closer look at the latest data shows that “crypto has penetrated key markets and become an important part of many residents’ day-to-day lives.” As the excerpt from Chainalysis’ upcoming Geography Report shows, no country from this region best exemplifies how crypto has become part of everyday life than Nigeria.
With transaction volumes of just under billion between July 2022 and June 2023, Nigeria is Sub-Saharan Africa’s largest crypto market by a distance. For perspective, the region’s total volumes during the same period were 7.1 billion. The data shows that Nigeria accounted for nearly half of the region’s total transaction volume in that period.
South Africa, whose traded volumes surpassed the billion mark during the same period, is home to the Sub-Saharan Africa region’s second-largest crypto market. Kenya, Mauritius and Ghana, which are ranked third, fourth, and fifth, respectively, complete the region’s top five.
Meanwhile, the Chainalysis data suggests that residents from the Sub-Saharan Africa region increasingly see BTC as an alternative store of value. With a regional volume share of 9.3%, Sub-Saharan Africa’s BTC share outranks all regions including North America (9.0%) and Eastern Europe (8.2%). Explaining why Sub-Saharan Africa is ranked first, Chainalysis said:
Many countries in the region have struggled with rising inflation and debt, making cryptocurrency an attractive means of storing value, preserving savings, and attaining greater financial freedom.
The blockchain intelligence firm singles out inflation-hit Ghana where residents reportedly have turned to BTC.
While BTC is still the number one crypto in the region, the latest data appears to point to a shift away from the leading crypto asset towards stablecoins. Moyo Sodipo, the co-founder of Nigeria-based cryptocurrency exchange Busha, said the drop in the price of BTC may explain why users from the region are gravitating towards stablecoins.
“Now that Bitcoin has lost a lot of its value, there is a desire for diversification between Bitcoin and stablecoins. However, market shifts aren’t dampening activity,” explained Sodipo.
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Morocco Denies South Africa’s Claim That It Has Applied to Join BRICS: Report
Morocco has reportedly denied the claim made by South Africa, the host of the BRICS summit this year, that it has formally applied to join the economic bloc. According to South African officials, over 40 countries are interested in joining the BRICS group, including 23 nations that have formally applied.
Morocco Maintains Good Relations With 4 BRICS Countries, Will Not Attend Summit
South Africa, the host of the BRICS summit this year, claimed last week that 23 countries have formally applied to join the economic bloc. According to South Africa’s Minister of International Relations and Cooperation, Naledi Pandor, they are Algeria, Argentina, Bangladesh, Bahrain, Belarus, Bolivia, Venezuela, Vietnam, Cuba, Honduras, Egypt, Indonesia, Iran, Kazakhstan, Kuwait, Morocco, Nigeria, State of Palestine, Saudi Arabia, Senegal, Thailand, United Arab Emirates, and Ethiopia.
However, at least one country on the list has reportedly denied applying for BRICS membership. Morocco’s state news agency Maghreb Agence Presse (MAP) reported on Saturday, citing an unnamed source in the Moroccan Ministry of Foreign Affairs, that Morocco has not made a formal request to join the BRICS group. Reuters quoted the news outlet as stating:
South Africa allowed itself to speak about Morocco’s ties with the BRICS without prior consultation.
“South Africa has in fact always shown a primary hostility towards Morocco and has systematically taken negative and dogmatic positions on the Moroccan Sahara issue,” the publication added, noting that Morocco has embraced non-divisive multilateralism and has maintained good relations with other BRICS member states. The economic bloc comprises Brazil, Russia, India, China, and South Africa.
“Morocco certainly maintains meaningful and promising bilateral relations with four other BRICS members and is even linked to three of them with strategic partnership agreements. However, the kingdom has never formally applied to join the BRICS group,” the Moroccan foreign ministry source reportedly said, adding that there is still “no framework or clear procedures governing the expansion of this group.”
Moreover, the Moroccan official stated that Morocco will not attend the BRICS’ upcoming summit in South Africa that will take place on Aug. 22-24 in Johannesburg. All BRICS leaders are expected to attend, but Russian President Vladimir Putin will not be attending in person.
“For Morocco, it has never been a question of responding positively to the invitation to the BRICS-Africa meeting planned in South Africa or participating in this meeting at any level. This meeting was organized on the basis of a unilateral initiative of the South African government,” the source noted. South Africa’s backing of the Algeria-supported Polisario Front, which aims to establish an independent state in Western Sahara, a territory Morocco claims as its own, has created tension between the two nations.
South African officials also previously revealed that President Cyril Ramaphosa has invited 67 leaders of countries in Africa, Latin America, Asia, and the Caribbean to the summit. In addition, 20 representatives of major international organizations have been invited, including the secretary-general of the United Nations, the chairperson of the African Union Commission, and the president of the New Development Bank, also known as the BRICS Bank. In July, Anil Sooklal, South Africa’s top diplomat in charge of BRICS relations, said over 40 countries are interested in joining the economic bloc.
What do you think about Morocco denying the claim made by South Africa, the host of this year’s BRICS summit, that it has applied for BRICS membership? Let us know in the comments section below.
US Dollar to Remain Major Global Currency, South Africa’s BRICS Sherpa Says
BRICS plans to discuss trade in national currencies at its summit but de-dollarization is not on the agenda, South Africa’s BRICS Sherpa stated. The talks in Johannesburg next week will also focus on the expansion of the bloc of emerging economies and the diplomat doesn’t see this as a challenge to any other organization.
De-Dollarization Not on BRICS Summit’s Agenda, According to South African Representative
Increasing trade in local currencies will be a subject of the talks between the member states of BRICS (Brazil, Russia, India, China, and South Africa) at their meeting in Johannesburg on Aug. 22–24, South Africa’s top diplomat in charge of relations with the organization, Anil Sooklal, told Bloomberg.
While the bloc will consider the establishment of a common payments system and is likely to form a technical committee to explore the issuing of a joint currency, it does not intend to discuss replacing the U.S. dollar as the world’s de facto global currency, he also said, and elaborated:
Trading in local currencies is firmly on the agenda. There is no agenda item of de-dollarization on the BRICS agenda. BRICS is not calling for de-dollarization. The dollar will continue to be a major global currency — that’s a reality.
BRICS has been looking to deepen trade in the national currencies of its members as part of efforts to increase its influence in the world as it already represents over 42% of the planet’s population and accounts for 23% of the global gross domestic product (GDP) and 18% of international trade.
The group’s New Development Bank (NDB) aims to bring the share of domestic currencies to a third of its lending in the next couple of years, the report noted. Last month, NDB’s Chief Financial Officer, Leslie Maasdorp, pointed out that creating a common currency to challenge the dollar is a medium- to long-term ambition for BRICS.
During the upcoming summit, however, BRICS will mainly focus on whether to induct more countries. Besides the leaders of the current five members, with Russian President Vladimir Putin joining via video link, the heads of state and government of 40 other nations have confirmed their attendance, a number that could rise even further, Sooklal said and added:
I think there is a general consensus that BRICS has to expand. We have worked out some rules of procedure and criteria.
An earlier report by Bloomberg in July revealed that China’s push for rapid enlargement of the bloc is facing opposition from India and Brazil. In early August, the Kremlin’s Press Secretary, Dmitry Peskov, admitted that “certain nuances exist among members on the subject of expansion.”
In his interview, Anil Sooklal also emphasized that BRICS is not in competition with any other grouping but aims to promote the interests of the developing world.
“There’s an unfortunate narrative being developed that BRICS is anti-West, that BRICS was created as competition to the G7 or the Global North,” Sooklal noted. “What we do seek is to advance the agenda of the Global South and to build a more inclusive, representative, just, fair global architecture,” the South African diplomat explained.
Do you think BRICS members will approve the organization’s expansion and eventually agree to issue a common currency? Tell us in the comments section below.
South Africa’s Foreign Minister Hints at Expansion of BRICS Bloc With 3 New Members
In a recent interview published on July 26, South Africa’s foreign minister Naledi Pandor highlighted the BRICS group of economies’ commitment to peace, asserting that these nations do not aim to “weaponize the oceans.” Moreover, leading up to the much-anticipated 15th BRICS Summit in Johannesburg next month, Pandor indicated that an announcement regarding the addition of three new countries to the BRICS nations is probable.
Ahead of 15th BRICS Summit, South Africa’s Pandor Talks Peace and BRICS Expansion
The forthcoming BRICS Summit, occurring from August 22 to 24, 2023, at the Sandton Convention Centre (SCC) in Johannesburg, South Africa, has generated considerable buzz. It is estimated that over 40 countries have either applied or expressed interest in joining the BRICS nations, comprised of Brazil, Russia, India, China, and South Africa.
Although discussions surrounding the BRICS are often linked with de-dollarization and competition with Western nations like the United States, the White House stated this week that it does not wish to restrict partnerships between countries. In an exclusive interview with South Africa’s foreign minister Naledi Pandor, the diplomat underscored that BRICS harbors no intentions of “weaponizing the oceans,” clarifying that talks of peace will be held during the 15th BRICS Summit.
Pandor also noted that a platform aimed at resolving the conflict between Ukraine and Russia would be established. “We’re not standing against anyone; we’re not standing for anybody. We work for the good of the world. We’re not seeking to weaponize the oceans, we’re not seeking to weaponize the forest, and we’re not seeking to weaponize climate change,” stated Pandor to RT. She further added that other African leaders intended to strengthen their ties with Russia.
While it has been reported that the upcoming summit will focus less attention on creating a BRICS reserve currency, expansion of membership appears likely. Ambassador Anil Sooklal, South Africa’s envoy to BRICS, hinted that the group would grow this year. Pandor substantiated these claims in an interview with RT, revealing that three new members will be joining the BRICS bloc, bringing the total to eight participating nations. Though she did not disclose the identities of the new member countries, Pandor praised the expansion as “fantastic” news.
What do you think about the upcoming BRICS Summit and the hints that there will be an expansion? Share your thoughts and opinions about this subject in the comments section below.
Study: Six Countries Account for Over 90% of Africa’s Crypto Interest in H1 2023
Between Jan. 1 and July 4, the Nigerian share of Africa’s overall interest in cryptocurrency stood at 66.8%, a figure nearly eight times that of second-ranked South Africa’s share, according to the latest Coingecko report. South Africa, along with Morocco, Ghana, Egypt, and the Ivory Coast, accounted for 23.8% of the continent’s interest in cryptocurrency year-to-date (YTD).
High Inflation and Currency Woes Fuel Nigerian Interest in Crypto
According to the latest Coingecko Africa crypto report, Nigeria had “the highest level of crypto interest” on the continent with a share of 66.8%. The West African nation’s share of the continent’s crypto interest is nearly 8 times that of the next highest-ranked country South Africa.
The data in the Coingecko report is the latest to reaffirm Nigeria’s status as Africa’s number crypto nation both in terms of user curiosity and traded volumes. According to the report, poor traditional finance infrastructure, high inflation, and currency depreciation are some of the factors which explain Nigerian residents’ unparalleled fondness for crypto.
Top Six Countries Account for Over 90% of Africa’s Overall Crypto Interest
Meanwhile, the data also shows that in the period between Jan. 1 and June. 4, no other African country had a level of interest in crypto which surpassed 10%. In South Africa, the level of interest in crypto stood at 8.36% during the same period. Morocco, which jailed a crypto trader in 2021, is ranked third with 5.43% while Ghana is just behind with 5.24%. Inflation-stricken Egypt completes the top five with a crypto interest level of 2.74%.
As shown by the statistics in the report, South Africa, Morocco, Ghana, Egypt, and the Ivory Coast accounted “for 23.8% of the continent’s interest in crypto YTD [year-to-date].” The data also suggest that the top six countries’ share of Africa’s overall crypto interest level in the period under review was more than 90%.
The findings also suggest that just eight countries had a level of interest in crypto which exceeded 1%. According to the data, South Sudan, Sierra Leone, and Mozambique had the least interest in crypto among the surveyed African countries.
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Africa’s Crypto Market Grew by 1,200% Between 2020 and 2021 — Study
Between the years 2020 and 2021, Africa’s cryptocurrency market grew by more than 1,200% while Kenya, Nigeria, South Africa, and Tanzania now all feature in the global top 20 for crypto adoption, according to the latest Emurgo State of Web 3.0 in Africa report.
Africa’s Share of Global Blockchain Funding Still Under 1%
According to the latest Emurgo State of Web 3.0 in Africa report, the African continent’s cryptocurrency market “grew by over 1,200% between 2020 and 2021.” In addition, four African countries, namely Kenya, Nigeria, South Africa and Tanzania now feature the in the world’s top 20 for crypto adoption.
As shown by the data shared in the report, Kenya, Nigeria, and South Africa accounted for 70% of the .5 million in blockchain funding which the continent received in 2021. However, despite this and the fact that African blockchain venture funding growth “was 11 times more when compared to general funding growth,” the continent’s share of total global blockchain funding is only 0.5%. This figure is nevertheless expected to grow when more companies attempt to create solutions to solve problems faced by the continent’s residents.
However, despite the underlying technology’s promise, as well as the impact that crypto assets have had on African residents, the report reveals that as much as 20% of countries in Sub-Saharan Africa have banned crypto assets. The rest have either imposed some restrictions or implicit bans. The Central African Republic is the only African country to designate bitcoin as a legal tender.
As noted in the report, many countries in Africa have not embraced crypto assets due to their perceived risky nature. The collapse of crypto giants like the exchange FTX and subsequent ripple effects have seemingly reinforced governments’ negative perceptions about crypto assets.
Mitigating Against Risks Arising From Regulatory Changes
Therefore, in order to help the continent’s crypto industry get on the good side of authorities, the authors of the report urged industry participants to consider working closely with regulators.
“As the need for the regulation of Blockchain and cryptocurrencies increases, key stakeholders need to work closely with regulators. This will ensure that risks that may arise as a result of regulatory changes are adequately mitigated,” authors of the Emurgo State of Web 3.0 report said.
More transparent regulations, on the other hand, will ostensibly see blockchain’s use cases increase. This increase in use cases will in turn spur further investments in the industry, according to the report.
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