Sales of an exclusively African cryptocurrency opened in August to those with a South African bank account, apparently capitalizing on the popularity of virtual currency in the nation. Despite the growing interest, however, scams and frauds are still widespread in the country.
Cryptocurrencies like Bitcoin have seen a 'surge in popularity across South Africa as the nation is struggling with political and economic uncertainty.
The nation has made international news while the African National Congress (ANC) and President Cyril Ramaphosa discuss polemics of agrarian reform in a country that faces high rates of unemployment and liquidity crisis
As a result, more and more citizens search for virtual currencies and there is also an increase in the volume of trade within the country. A survey conducted by a pan-African investment bank in July revealed that 38 percent of South Africans "hope to have invested" in cryptocurrency.
The legal regulations of the nation have also been relatively scarce.
The South African Revenue Service announced a new fiscal framework for cryptocurrencies in April, but authorities have not yet had other mandates regarding the digital currency market yet.
First Dibs on SAFCOIN
South African investors now have a new cryptocurrency to examine before the rest of the world can look.
Anyone with a valid bank account can now purchase some of the 500,000 SAFCOINs available exclusively for sale to South Africans. In October, 5 million tokens will be listed on other local and international stock exchanges.
Launched by a blockchain company called FHM (Pty) Ltd., SAFCOIN is designed to help Africans participate in digital currency investments. Company executives hope to see SAFCOIN "becoming a widely accepted form of payment throughout the African business community" by eliminating "bureaucracy and cumbersome processes".
FHM stated in mid-July that over 400 e-commerce companies were willing to accept SAFCOIN as payment.
A thriving market, but one with some risks
Although many exchanges see record levels of visitors from South Africans who are trying to buy, sell, trade and expand their portfolios, there have been some high-profile scams that have cheated investors.
In March, a massive Ponzi scheme in the country involved about 28,000 investors in virtual currency. BTC Global has been able to steal at least $ 80 million from victims. At the end of May, the South Africa Directorate for Priority Crime Directorate declared that BTC Global representatives promised "2% interest per day, 14% per week and finally 50% per month" for returns of investments. The authority also claimed that the BitCaw trading company was involved in the program, an accusation that the company strongly denied
experts also worry about the lack of education and awareness in all of Africa on the risks and responsibilities associated with investments in cryptocurrency. Rafiq Phillips of & # 39; just for Getting it (dot) CryptoCurrency & # 39; he thinks that the virtual currency world in Africa is on the whole "piled up against the man on the road" while speculation holds the market across the continent.
Do you think that cryptocurrency is a valid alternative for South Africans who try to protect themselves from instability? Can you trade weather scams and frauds and thrive across the continent? Let us know in the comments below!
Images courtesy of Shutterstock, SAFCOIN, Bitcoinist Archive.