There is an unseen stagnation in the growth of Blockchain and cryptocurrency development across Africa. This is a thought that many practitioners are yet to come to terms with. It is true that available figures may reveal an increased level of activity in terms of cryptocurrency transactions. This is more of an increase in intra-community entropy rather than an expanding industry.
Expansion and increased activity are two different things. When the same group of people tune up their extent of participation, the reflection would surely be seen from the outside. The result is the same when adoption increases and there is an influx of new participants. Our concern in this post is in differentiating between the two scenarios and understanding which is currently playing out within the blockchain and cryptocurrency industry.
Blockchain Needs More Adoption
Blockchain is new, so is its associated element, cryptocurrency. Most important for blockchain technology at its present stage is adoption and mainstream implementation. The idea of building solutions using this novel technology is to expand the web of users, thereby pushing the technology much more into unconquered regions.
In terms of spread and adoption, blockchain technology has indeed come a long way. To this, credit must be given the inseparable element of the technology, cryptocurrency. Many people across the world today know about the words Bitcoin and cryptocurrency before learning anything about blockchain. It can be argued that the popularity that blockchain has achieved today has a lot to do with cryptocurrency activities, especially Bitcoin.
Of all the seasons that Bitcoin and blockchain has been through, the 2017 boom stands out. This was obviously the period that the highest Bitcoin and blockchain awareness swept past different parts of the world. Not everyone will agree that they learnt about Bitcoin through the right channels. While many did through proper education and genuine investment practices, there are those whose fingers were burnt by the activities of scammers and insincere industry players.
The Current State Of Blockchain Industry
Having mentioned this key aspect in the propagation of the Bitcoin and blockchain gospel, it is clear that since the 2017 boom era, a defined Bitcoin and blockchain community now exists across the globe. This community is divided into smaller regional cells that are motivated by different activities.
Bitcoin and blockchain evangelists will tell you that much more adoption is still needed for this novel technology to go mainstream. What this means is that apart from increased use by those already familiar with the technology, a larger population of users are needed for growth. Hence, the actual meaning of adoption in this context. In most parts of the world, Bitcoin and blockchain users exist in cells and communities, as already mentioned above. This includes those who are developing products that enable users to solve problems, ranging from remittances, DLT services, Fintech solutions and many other use cases.
Smaller Start-Ups Are Facing Serious Competition
At the moment, for almost every need of a crypto or blockchain user, there are multiple solutions. This might sound like a good thing for users, as they have the luxury of multiple options. But on the flip side, it has generated some fierce competition among the solution providers.
Take for example the number of exchanges that are available for a regular crypto user in Nigeria. A random check will show that there are several of them, especially the indigenous platforms. However, only a few big dogs appear to be taking all the market. An average cryptocurrency user in Nigeria would rather transact on Binance, Luno or Remitano, rather than doing business on any of the smaller platforms.
The point here is that assuming that there has been widespread adoption in the industry, and the actual crypto users cut across huge populations, even the smaller players will not struggle to keep their heads above water. The size of the market will be so large that only the big players will not swallow everything.
Smaller Start-Ups Must Return To The Basics
Just like the 2017 boom era that has been mentioned above, the high network activity in the crypto space in recent times is caused mostly by the same group of people recycling their funds. This is not a sign for healthy growth, especially for a novel industry.
Perhaps, rather than struggling for the same limited market, solution providers, especially the smaller ones need to start thinking of how to expand the community. The focus should be on creating a new market, rather than engaging in a battle that can never be won. Imagine one of the small indigenous exchanges in Nigeria struggling in the same market as Binance. That is clinical suicide!
Unfortunately, even when some of these smaller solutions try to solve specific problems and create their own niche, you’ll discover that what they are trying to achieve is just an aspect of what the bigger establishments are doing. There is no way you can have a level playing field under this kind of structure. Therefore, the one reasonable solution for smaller projects, especially the indigenous ones is to go out there and become the agents of actual expansion of the blockchain community.
Projects need to go back to the basics of scouting for new recruits into the blockchain ecosystem. Train them by their own doctrine and by so doing, create their own “local” market. There is something about mentorship and followers, it is the loyalty that comes with it. This may look like a tough task, but when you don’t have the financial capacity to compete with the bigger players, what do you do? You must play tough or you go extinct!
As noted at the beginning of this post, the blockchain and cryptocurrency industry has stunted in expansion. What we are seeing most of the time is the recycling of users within an industry that is supposed to be recruiting new users. Unfortunately, the bigger players who are profit-oriented may not bother so much about launching into new grounds. After all, they are in control of the existing environment. Therefore, smaller projects that want to remain relevant must eat the humble pie, go back to the basics and focus on blockchain and crypto evangelism. Perhaps, that is what would push the entire industry into the long awaited mainstream adoption.
Iyke Aru is a seasoned author and educator in the blockchain and cryptocurrency industry. He has been in the business of crypto content writing for many years with thousands of his articles across several platforms on the internet. Iyke is based in Nigeria where he stands out as one of the most informed and credible figures in the cryptocurrency industry. Outside blockchain and crypto, you will most likely catch Iyke playing or discussing football with friends and family.