Plugs in Headphones 🎧 — "Let's Start*” x Fela Kuti🎶*

Technology adoption in Nigeria has undergone roughly three cycles - The mobile adoption cycle, an aggressive e-commerce push, and we are currently in a fintech driven mania.

Each wave updated consumer habits and also served as the bedrock for the next cycle -ensuring seamless adoption and reinforcing a positive feedback loop. Mobile phones + the Internet made Instant messaging, social media and e-commerce possible. E-commerce adoption confirmed that there is a healthy market for fintech to thrive.

As fintech players have continued their push with savvy products in payments and investments, the global economic landscape (money printer go brrrrr) and local macroeconomic conditions have set the scene for a fertile crypto adoption curve in Nigeria.

Africa’s cryptocurrency adoption is surging faster than any other region, and it’s not just a few giant whales pushing Africa’s crypto trajectory; according to Chainalysis, transactions volume made up of retail-sized transfers in Africa was 7% against the global average of 5.5%.

Despite the Central bank cutting off all crypto on-ramps, the dollar volume of cryptocurrency transactions from Nigeria ROSE to $132 million, up 17% from February 2021 - if this isn’t proof of stickiness, I don’t know what is.

Nigeria is a country with low state capacity, and that is precisely the kind of environment for decentralized blockchains to make a positive impact. People who have never lived under authoritarian governments with deprived economies do not appreciate the need for censorship-resistant, ultrasound money. Crypto eludes them because of privilege.

The naysayers believe it’s like the tulip mania; it’s all speculative; crypto has no use case today. But, as a Nigerian living in Nigeria, I fear the naysayers are myopic. As Balaji’s wrote in 2018 - the blockchain has already provided 10X improvements in gold, international wire transfers, and crowdfunding.

So what will adoption look like in Africa? I think we have three straightforward songs where crypto adoption will be on repeat; let’s listen to them;

Track 1 - “Money quick to enter.”

Everyone who grew up in the internet age is spoiled for one thing, two actually - speed and access.

You can instantly send an email from Lagos, Nigeria, to someone in Auckland, New Zealand. Your girlfriend went on a girls’ trip to Tokyo? And you need to keep in touch? No problem! - with FaceTime, Snapchat, Zoom, iMessage, WhatsApp, Twitter amongst 1000+ other apps this is feasible.

However, try sending money to them first - you see, it takes crossing seven seas to send money from country A to B. It makes no sense in a world where 92% of total currency valued at over 40 trillion is digital.

Furthermore, let’s assume your friend is stranded on a private island and needs $30 to get out of the issue; in Nigeria, the monthly spending limit is $20, so sorry to that friend.

However, solutions exist today! Anyone can receive bitcoin anywhere globally, with no limits, no filling of 200 forms asking you to explain why you need to send money, just like sending an email, all you need is an internet connection.

It is why I am bullish on solutions like Sendcash and Bitnob’s Lightning Network integration. We will soon be in a future where Nigeria’s $18 billion remittance market runs primarily on crypto rails.

Track 2 - Pay me in Bitcoin, Ethereum or USDC

If you live in Nigeria and most of Africa, to be honest then your finances are being attacked & laid to waste on two levels: income and investments, all thanks to a nine-letter word called -INFLATION.

The Nigerian Central bank’s most important job is to ensure stable and low inflation; the CBN's unprovoked (their self-imposed target, we didn't vote for it o) inflation target is 6-9%. The last time the CBN met the official target was in 2014 - 8%, a colossal failure. Furthermore, between 2016 and 2020, the average annual inflation was 13.7%, which means the value of the Naira halves every five years. Young people with means are already voting with their wallets.

This reality is why young people are increasingly desirous of working for foreign companies and embracing tech roles - all in a bid to escape the harsh realities of the current macroeconomic environment.

As the fintech revolution matures with a fast-growing population of internet natives, we will increasingly see people demand salaries in crypto dollars.

The revolution is already happening. Adopting ultrasound money like Ethereum or less volatile currencies like the dollar through USDC will unlock earning potential for the young, underemployed and over-educated African population.

Track 3 - “How do you wish to pay? With crypto, please!”

The above statement might sound fictional, but the reality is that receiving payments for services/products rendered to international clients as an African is quite depressing. Paypal doesn’t work, and wiring money? It takes ages, and some services restrict usage by Africans. The same goes for African businesses trying to purchase services of international vendors or well to do Africans who want to partake in investment opportunities on a global scale.

The revolution is already happening; Angellist now allows people to invest via USDC; GetEquity, a private marketplace to invest in startups, provides funding through stablecoins. In addition, several startups like Fluidcoins and Lazerpay are working hard to lower entry barriers to accepting global payments by bridging the gap between fiat and cryptocurrencies.

Sending money, receiving money, escaping inflation, payroll, and Borderless Payments demonstrate that the crypto revolution is already here. What is left is seamless execution and distribution, and if crypto has achieved all of these (and more) in just 13 years of existence, I expect it to do so much more.

WAGMI

Thanks to Dayo and David, who looked at drafts and made helpful comments to this article before publishing.