Bitcoin is a digital currency that was built by an anonymous developer (or group of developers) called Satoshi Nakamoto as a more advanced alternative to traditional currencies. Over the last decade it has become increasingly popular across the globe and even in the Gambia people are using the infamous “internet money.”
In this article, Alex Lielacher, founder and editor-in-chief of BitcoinAfrica discusses how Gambians can use bitcoin in 2020.
Bitcoin as an Investment
The most popular way people use bitcoin is as an investment. Even though it was created to be used as an everyday currency, it’s gold-like features have made it a viable investment asset.
People buy digital currencies and keep them as an investment against their local currencies due to the uncertain economic circumstances being experienced around the world.
A lot of Africans are actively buying bitcoin on peer-to-peer exchanges, such as LocalBitcoins or Paxful to gain investment exposure to the digital currency.
In the first week of May, for example, Africa recorded over $10 million in trading volume on these P2P platforms. This trend shows a pattern of ongoing investments in bitcoin on the continent.
Send Remittance via bitcoin
Africans abroad make up most of the remittance recorded globally. Remittance involves people sending money to people across the world.
In most cases, there are options for remittance in Africa, and in a few situations, there are none particularly as some of the local African banks lost few of their correspondent banking relationships. The funds transfer options are mostly expensive, risky or have several requirements.
According to research, over 20 million African migrant workers send about $40 billion to their families every year.
The money sent from these migrant workers accounts for more than 20% of Gambia’s Gross Domestic Product (GDP) as of 2016. This number is set to increase as more people migrate in search of greener pastures.
Bitcoin will allow Gambians to send money to or receive money from any part of the world. The growing gig economy of freelance workers can also utilizes digital currency as a method of payment.
Mobile Minutes top-ups
As a digital currency, bitcoin can also be used to purchase items such as mobile minutes. Bitcoin makes airtime purchases very easy as several applications allow you to make purchases with your bitcoin directly.
Sites like Bitrefill and SpectroCoin have functionalities that can allow consumers to buy mobile top-ups for QCell, Gamcell, Africell, and Comium networks. You will simply have to select your network, enter your number, and make payment to receive top-up.
Bitcoin and other cryptocurrencies become very popular for fundraising between 2016 to 2018. Therefore, digital currencies also presents an opportunity for Gambian startups, small businesses, and non-profits to raise funds.
Companies may pitch to investors willing to invest capital into startups to receive funding. Also, companies who have acquired funding may opt to receive it via currencies like bitcoin which is a cheaper and faster alternative to traditional methods.
Aside from for-profit organisations, bitcoin is also used by several NGOs to further their work on the continent. For instance, P2P platform, Paxful is building schools in Africa with its #BuiltWithBitcoin initiative.
Also, BitGive partners with water production companies to provide water for rural areas. Binance, Legs4Africa, and GiveDirectly also utilise bitcoin for their humanitarian efforts.
Use cases of bitcoin in Africa continue to increase as the growing fintech market continues to innovate around it. While the use of digital currency in The Gambia is still very small, bitcoin is making waves across the globe and in Africa and is poised to also grow in the Gambia.
This article was a guest contribution by Alex Lielacher, founder and editor-in-chief of BitcoinAfrica.io.