Top African Blockchain Headlines in 2023, as penned by Mariblock's scribes

Africa's crypto landscape in 2023 saw significant strides in regulation, investment, and adoption, despite the challenges that have kept crypto remittances niche. The continent received a staggering $100 billion in remittances last year, but the crypto remittance sector remained relatively small due to public trust issues, unfamiliar user experiences, regulatory concerns, and a lack of institutional interest.

However, the increasingly progressive crypto regulatory landscape in Africa's largest economies is likely to attract the capital needed to grow the ecosystem. Regulatory advancements in Nigeria and Kenya are setting the stage for a year of growth across the African blockchain landscape.

In April 2023, Nigerian venture capital firm Echo VC launched an $8 million pilot blockchain seed fund called EchoVC Chain. Focusing on business-to-business infrastructure, decentralized finance (DeFi), and market-making solutions, this fund aims to foster innovation and drive blockchain adoption in Africa. Fellow early-stage investor DFS Labs also launched a blockchain fund to support African entrepreneurs building innovative digital payment solutions on the Stellar blockchain.

One of the most significant developments in 2023 was the acquisition of Qala by Btrust. This acquisition highlights the need for technical talent in Africa for the advancement of the Bitcoin protocol in emerging markets. Btrust, a non-profit founded by Jack Dorsey and Jay Z, acquired Africa-focused Bitcoin talent firm Qala in September 2023.

Ghana is finalizing a regulatory framework that will require crypto platforms to be licensed, maintain minimum capital thresholds, and report suspicious transactions. This law aims to integrate digital assets into the formal economy, boost cross-border trade, and improve financial data collection. Namibia enacted the Virtual Asset Act in 2023, establishing regulation for crypto service providers under the supervision of the Namibia Financial Institutions Supervisory Authority. Benin passed Law No. 2024-01 in February 2024, aligning with anti-money laundering rules and targeting Virtual Asset Service Providers (VASPs) by requiring them to obtain authorization and comply with transparency and security standards.

Countries like Senegal and Côte d’Ivoire, members of the West African Economic and Monetary Union (WAEMU), still lack clear cryptocurrency laws or licensing systems. Crypto businesses operate without formal legal protection, and banks are barred from offering crypto services. South Africa has no formal regulation treating crypto as capital or money, but the South African Reserve Bank (SARB) is developing a regulatory framework, indicating regulatory changes may be forthcoming.

More broadly, the African crypto regulatory landscape remains fragmented. Some countries welcome innovation, while others enforce bans. There are calls within the African Union and AfCFTA to develop continental policies, harmonize consumer protections, and leverage digital infrastructure improvements to foster a coherent digital asset ecosystem.

The regulatory clarity in South Africa has been a significant factor in the institutional adoption of cryptocurrency. In November 2023, South African payment gateway Stitch integrated crypto payment options, powered by crypto exchange Valr. The web3 software development arm of Block Inc., TBD, partnered with Yellow Card, a pan-African cryptocurrency exchange, to facilitate cross-border transactions across 16 African countries in April 2023.

In summary, 2023 saw important steps in formalizing crypto regulation in select African countries like Namibia, Ghana, and Benin, while many others remain unregulated, highlighting an ongoing transition towards clearer legal frameworks across the continent. The launch of EchoVC Chain during the bear market could be seen as a validation of the potential of blockchain to solve problems on the continent. The integration of crypto payment options by Stitch and the partnership between TBD and Yellow Card are promising signs of a growing crypto ecosystem in Africa.

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Africa's crypto landscape in 2023 witnessed substantial progress in regulation, investment, and adoption, despite the persistent challenges that keep crypto remittances niche.
The continent received a huge $100 billion in remittances last year, but the crypto remittance sector remained small due to trust issues, unfamiliar user experiences, regulatory concerns, and a lack of institutional interest.
Regulatory advancements in Nigeria and Kenya are shaping up a year of growth across the African blockchain landscape.
In April 2023, Nigerian venture capital firm Echo VC launched an $8 million blockchain seed fund called EchoVC Chain, focusing on business-to-business infrastructure, decentralized finance, and market-making solutions.
Ghana is finalizing a regulatory framework that will require crypto platforms to be licensed, maintain capital thresholds, and report suspicious transactions, aiming to integrate digital assets into the formal economy.
Namibia enacted the Virtual Asset Act in 2023, establishing regulation for crypto service providers under the supervision of the Namibia Financial Institutions Supervisory Authority.
Benin passed Law No. 2024-01 in February 2024, aligning with anti-money laundering rules and targeting Virtual Asset Service Providers by requiring authorization and compliance with transparency and security standards.
South Africa has no formal regulation treating crypto as capital or money, but the South African Reserve Bank is developing a regulatory framework, indicating potential regulatory changes may be forthcoming.
The fragmented African crypto regulatory landscape needs harmonization and development of continental policies to foster a coherent digital asset ecosystem, as called for within the African Union and AfCFTA.