Nigeria received nearly $60 billion in crypto value in a year

Blockchain analytics firm Chainalysis has published the Sub-Saharan Africa (SSA) portion of its Global 2023 Geography of Cryptocurrency Report. While the headline data shows that SSA continues to be the smallest crypto economy globally, as has been the case over the years, the details reveal a region where digital assets have gained a foothold.

Cryptocurrency value received by Sub-Saharan Africa

Key data: Sub-Saharan Africa received just 2.3% of all crypto value globally between July 2022 and June 2023. That amounts to $117.1 billion.

• By comparison, the region received $100.6 billion between July 2021 and June 2022. That represented 2% of global crypto activities.

For the first time, Chainalysis gives a breakdown of crypto value received by country.

• As the chart below shows, Nigeria is by far the most prominent crypto market in the region, receiving nearly $60 billion in crypto value during the same period. South Africa is distant second, receiving just over $20 billion between July 2022 and June 2023.
• While Kenya came in third, the big surprise is Mauritius being fourth-placed, just ahead of Ghana.

Essential context: Following the TerraLuna and FTX debacles of 2022, both plunging the crypto market into the bear zone, the demand for trading diminished. That has played a part in the closure of some crypto exchanges in the SSA region.

• Still, the region’s overall crypto value received is at an all-time high.
• As Chainalysis data suggests, what has happened is that Sub-Saharan Africa is moving away from speculative use.

Over the past year, several crypto exchange operators told Mariblock that a significant portion of their trading volumes consisted of stablecoins, albeit without specifics. Now, there’s data to support those claims.

• Chainalysis data shows that Sub-Saharan Africa has experienced a “proportionally large percentage of monthly stablecoin value” relative to other asset types.

Nigeria, Africa’s leading crypto economy

As the country-based chart depicts, Nigeria is responsible for the largest share of crypto value received by Sub-Saharan Africa.

• According to Chainalysis, the West African country’s crypto economy grew over the past year despite broader market struggles.

Key quote:

Nigeria is one of only six countries in the top 50 by size globally whose crypto transaction volume grew year-over-year in the time period we studied. Its growth rate of 9.0% places it third among those six.

Further evidence suggests that Nigerians have been looking to crypto as a hedge against worsening inflation and currency devaluation, a consistent feature of the country’s economy. Data shows that interest in bitcoin and stablecoins increases when naira’s value drops.