Cryptocurrencies and Web3 technologies are reshaping the global financial landscape, and Africa is at the forefront of this transformation. A new study by ConsenSys, in collaboration with YouGov, reveals the attitudes, adoption patterns, and challenges surrounding these technologies in Nigeria and South Africa.
These findings highlight the potential for digital currencies to drive financial inclusion and innovation across the continent. However, they also showcase the varied pace and nature of adoption in these two leading economies.
In Nigeria, for instance, cryptocurrency adoption is massive, with nearly universal awareness (99%) of digital currencies among respondents.
A significant 77% understand how cryptocurrencies work. This underscores the nation’s familiarity with this transformative technology.
The awareness is not just superficial—Nigerians are actively engaging with cryptocurrencies, making the country one of the world’s most vibrant markets for digital assets. The numbers tell a story of robust participation.
Among those aware of cryptocurrencies, 73% have purchased them at some point, and 42% currently hold digital assets. This is a possible indication that Nigerians are not just interested in crypto; they see it as a viable investment and a tool for financial empowerment.
The most commonly purchased cryptocurrencies are Bitcoin, Binance and Ethereum. Interestingly, while Bitcoin and Ethereum saw slight declines in popularity compared to the previous year, Binance has gained traction. This signals a shift in user preferences.
The future looks even brighter.
A staggering 93% of respondents expressed plans to invest in cryptocurrencies over the next 12 months. This growing interest is underpinned by the belief that digital currencies represent “the future of money” (58%) and a pathway to participate in the global financial ecosystem (49%).
Web3 adoption
Nigeria’s enthusiasm extends beyond cryptocurrencies to Web3 technologies, which promise to decentralise the internet and give users more control over their data and digital identities.
Awareness of Web3 stands at 61%, and more than half of the respondents reported engaging with Web3 activities such as using crypto wallets, sending and receiving transactions, and playing blockchain-based games.
Blockchain-based gaming, in particular, has seen significant growth, with 34% of respondents participating, which is up from previous years. This highlights the potential of Web3 to go beyond finance and integrate into entertainment and everyday digital experiences.
Other activities, such as staking cryptocurrencies, decentralised social media usage, and trading on decentralised exchanges, are also on the rise, reflecting a broader engagement with blockchain technology.
Barriers and challenges
Despite Nigeria’s high engagement, challenges remain. The volatility of cryptocurrency markets is a major barrier, with 56% of respondents citing it as a concern.
Scams also loom large, affecting nearly half (47%) of respondents. These concerns underline the need for better education and regulatory frameworks to build trust in the ecosystem.
Security and privacy are also key priorities for Nigerians. A majority (85%) own at least one crypto wallet, and 54% are familiar with the differences between custodial and self-custody wallets.
Interest in self-custody solutions is growing rapidly, with 94% expressing a desire to learn more about these wallets. This indicates a strong demand for tools that empower users to take greater control over their digital assets.
Read also: Despite clampdown, Nigeria emerges 2nd in global crypto adoption
NFTs and environmental impact
Non-fungible tokens (NFTs) have gained a foothold in Nigeria, with 58% awareness among respondents. Of those familiar with NFTs, 35% currently own them, and another 33% have owned them in the past. The appetite for NFTs is growing, with 94% of respondents likely to invest in them within the next year.
When it comes to environmental concerns, Nigerians are overwhelmingly positive. A notable 87% believe that cryptocurrencies are environmentally friendly, with Bitcoin receiving particularly high marks. This sentiment reflects a broader optimism about the potential of blockchain technologies to align with sustainability goals.
South Africa
In South Africa, cryptocurrencies and Web3 technologies have made significant inroads, but the adoption narrative is more cautious compared to Nigeria.
Awareness of cryptocurrencies is nearly as high, at 97%, but only 65% of respondents understand how they work. This gap between awareness and understanding points to the need for greater education and outreach.
While 68% of South Africans who are aware of cryptocurrencies have purchased them, only 22% currently own digital assets. This indicates a relatively lower level of ongoing engagement compared to Nigeria. The intention to reinvest is also less pronounced, reflecting a more cautious approach to crypto as an investment.
South Africans are less likely to view cryptocurrencies as transformative. Only 47% associate them with “the future of money,” compared to 58% in Nigeria. Similarly, while 35% see cryptocurrencies as a way to participate in the global financial ecosystem, this is significantly lower than Nigeria’s 49%.
Concerns about scams top the list of barriers in South Africa, with 54% of respondents citing this as a major deterrent. Confusion about where to start (47%) and scepticism about the purpose of the technology (43%) are also significant challenges. These concerns highlight the importance of addressing user fears and providing clear, accessible pathways into the crypto ecosystem.
Web3 adoption
Web3 technologies are gaining traction in South Africa, but adoption remains slower than in Nigeria. Just under half (48%) of respondents are familiar with Web3, and participation in activities like decentralised exchanges, staking, and NFT trading is less widespread.
However, there are signs of growth. Interest in decentralised social media platforms, for example, is increasing, as is engagement with blockchain-based games. South Africans also show a strong appreciation for the potential of decentralisation to improve various sectors, including international banking and social media.
NFTs and environmental concerns
NFT awareness in South Africa mirrors Nigeria’s at 54%, but ownership and investment intentions are more subdued.
Environmental concerns also weigh more heavily in South Africa, where only 76% of respondents view cryptocurrencies as environmentally friendly. This marks a significant drop compared to Nigeria, reflecting a more sceptical attitude toward the sustainability of blockchain technologies.
What the numbers tell us about Africa’s financial future
The contrasting attitudes in Nigeria and South Africa offer valuable insights into the state of cryptocurrency and Web3 adoption in Africa.
Nigeria’s enthusiasm underscores its role as a global leader in digital finance, driven by a young, tech-savvy population and a pressing need for financial inclusion. South Africa’s more cautious approach reflects a society grappling with trust issues and a slower pace of technological adoption.
However, both nations recognise the potential for cryptocurrencies and Web3 to drive meaningful change.
In Nigeria, the focus is on participation and inclusion, with respondents viewing these technologies as tools to democratise finance and connect with global markets. In South Africa, the emphasis is on addressing systemic barriers and fostering trust, highlighting the need for education and robust consumer protections.
Lessons for the future
The findings from Nigeria and South Africa point to several key takeaways for policymakers, educators, and businesses:
1. Education is crucial: Addressing gaps in understanding is essential to building trust and fostering broader adoption. This is particularly true in South Africa, where scepticism remains a significant barrier.
2. Regulation can build trust: Clear and fair regulations can help mitigate concerns about scams and volatility, making the ecosystem more accessible to hesitant users.
3. Localised solutions are key: The differences between Nigeria and South Africa highlight the importance of tailoring solutions to local contexts. While Nigerians are eager to embrace new technologies, South Africans may benefit from initiatives that prioritise security and transparency.
4. Broader applications of Blockchain: Beyond cryptocurrencies, Web3 technologies offer opportunities to transform sectors such as gaming, media, and decentralised finance. Encouraging experimentation in these areas could unlock new pathways for adoption.
Bottomline
The story of cryptocurrencies and Web3 in Nigeria and South Africa is a tale of two trajectories, each shaped by unique cultural, economic, and social factors. Together, they represent the diversity and potential of Africa’s digital future.
With the right investments in education, infrastructure, and regulation, both Nigeria and South Africa are well-positioned to harness the transformative power of cryptocurrencies and Web3.
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