Mistrust & Crypto illiteracy is limiting its Adoption in South Africa:Report

Kaspersky, a cyber security company has released a report that indicates that ‘mistrust and lack of understanding’ are the stumbling block to crypto adoption in South Africa. The report is titled ‘Uncharted Territory: Why Consumers Are Still Wary about Adopting Cryptocurrency’. Findings from this report have revealed that a lack of understanding could be resulting in the mistrust that cryptocurrencies can keep a consumers’ money safe. Drawn from that is how there is a common opinion in South Africa that cryptocurrencies are volatile and can only be used once they are stable; about 35 percent of South Africans share this opinion. Some other consumers are of the belief that cryptocurrencies will not be around forever and about 17 percent respondents said that cryptocurrencies “are not worth bothering about.”

From the above and more elaborate explanations in the Kaspersky report, it was noted that how cryptocurrencies work is not widely comprehended among most consumers thus restraining mainstream crypto adoption. This is not restricted to South Africa alone, but even globally as the report stated, adoption is also declining in spite of celebrities and influencers endorsing cryptocurrencies, the report stated.
Based on headlines and news pieces concerning crypto adoption in various African countries, South Africa can vaguely be pictured as the trendsetter for other nations. Cryptocurrency options in South Africa were reported to be on the rise at the start of Q2. At the time, their government was seen to have paved way for the crypto space to grow and crypto ownership in South Africa was known to be the highest in the world. There were also talks about the S.A government aiming at regulating cryptos towards the end of May.

Head of Commercialisation at Kaspersky, Vitaly Mzokov, however, said, “To date, 70 percent of South Africans have never purchased cryptocurrencies, highlighting just how far away we are from it being accepted as a common form of payment or investment. It is clear that mainstream adoption and growth of cryptocurrency is being held back due to the vulnerable nature of the technology.” This almost contradicts most of the past new headlines of  SA’s steady rise in crypto adoption. From his observation also, consumers will not easily use their income to buy into a digital currency they have no proper education or even trust. But a high interest in using cryptocurrencies in the country does not totally spell out that citizens are actually taking action on that interest.
The 19 percent that completely understands how they work may be the cause of high demand for cryptocurrency use according to the report in addition to the 34 percent of South Africans have ‘some’ crypto knowledge. Also, Paxful’s educational workshops that kicked off from May in SA and Kenya could have upped that number.
As a solution or a measure that can aide the situation, Mzokov advised cryptocurrency companies to guarantee the protection of consumers’ investments on prospective or already built platforms. “It is […] imperative that cryptocurrency businesses do all they can to protect their networks and ensure their customers’ finances are safe and secure,” he asserted.

Currently, emerging markets are said to be more likely to adopt cryptocurrencies than developed markets but it doesn’t seem that way going by the Kaspersky report. As time passes, there could be notable changes before the year ends since the first Crypto Festival in South Africa’s is scheduled to hold in Cape Town by September. The envisaged festival will highlight the exciting opportunities that cryptocurrencies offer individuals and organizations from cross-industries which is another measure that needs to be taken.

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Credits- Angeline Mbogo

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