The Blockchain technology is rapidly gaining popularity over the world. Ever since its entrance to Africa, the technology has been used to provide a solution to the various problems plaguing the continent from remittances to voting. The technology seems to hold the key building a financially inclusive digital economy in the continent. It could also help to restore the faith in governance through its immutable record keeping abilities and traceability. However, despite the numerous benefits, the blockchain technology holds for Africa, it isn’t without hurdles.
With an estimation of 1,290,221,906 billion people, Africa has remained one of the poorest regions in the world with about two-fifths of its Population living on less than $1 per day. Although some countries have great economic performances, none of them have however been able to make a drastic change in the poverty ratio. However, the blockchain technology is offering a way out for the continent and providing people with an alternative in generating funds through crowdfunding, the solution to the data crisis the continent suffers from and inclusion to financial and technological services. The adoption of this technology has however faced certain challenges.
Regulations
A key determinant in the adoption of the blockchain technology in Africa is the government. Formal regulations to enable cryptoprenuers operate globally and within the law of their country needs to be put in place. But, some countries are taking a strict stance against the technology. A country such as Kenya appointed an 11 man team to look into the technology. However, some weeks back, Kenya’s Treasury Secretary, Henry Rotich was given an ultimatum to decide if cryptocurrencies should be regulated or not.
The ICT ministry of Uganda is employing the technology into the country’s service. On the other hand, Nigeria has said nothing about adopting the technology. Only it’s lawmakers moved a motion in April for the study of the technology while the CBN governor warned its Citizens about investing in cryptocurrencies. Egypt is adopting a rigid stance to cryptocurrency the country’s Financial Regulatory Authority (FRA) had issued a warning against trading in crypto. Most of these countries might take some time before coming to terms with the technology.
The Problem of Integration
The Blockchain technology is revolutionizing traditional systems and the ways things are being done. This transition stage is not easy for most of these systems to adjust to therefore making integration difficult. Third party systems are threatened by the technology which offers peer to peer transactions. Getting stakeholders to integrate the technology into businesses also proves difficult since people have been used to a particular system for so long. However. The technology is making headway.
The Internet Hurdle
Africa is faced with the problem of internet connectivity. This is proving to be a huge problem in the digital age. To make use of the blockchain technology most often, an internet enabled phone or computer is needed. But then, only 31.2% of Africa’s population has access to internet connection. Although the number of internet users is rising as well as awareness about the technology, for the blockchain technology to flourish in Africa, a change has to occur.
What other problem do you think the blockchain technology is faced with in Africa? Share your opinion with us in the comment section below.
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