The latest survey by one of the leading blockchain firms in the world, Triple A, has placed Ghana fourth in Africa in the World Cryptocurrency Index 2021.
The survey revealed that nearly a million Ghanaians owned cryptocurrencies in 2021. This can also be linked to a rise in technology awareness in the country, as well as the increased usage of the internet for digital transactions.
The increase in Ghana’s crypto volumes and usage is ascribed to the country’s tacit endorsement of cryptocurrency, according to the report.
One aspect that may have helped Ghana’s volumes, according to the research, was the Central Bank of Ghana’s creation of “a regulatory sandbox that prioritized block chain-based companies including cryptocurrency startups” as one factor that may have boosted the country’s crypto volumes.
Mr. Gospel Obele, a Research and Development Economist, predicted that cryptocurrency transactions will increase in the months ahead, owing to the country’s severe inflation and millennials’ desire for a reliable and decentralized investment market.
“This should tell you that Ghana and the rest of Africa is ready for a new payment pool as a plan B to the growing economic instability.”
Mr. Gospel Obele
Risks of fiat currency to a single regional currency
Nigeria and Ghana are hurrying to develop a central bank digital currency in order to stifle the appeal of cryptocurrencies in the two major economies in West Africa.
Both countries’ central banks have teamed with international financial technology companies to develop digital versions of their currencies, joining a worldwide train of countries that are investigating the idea.
Nigeria’s eNaira digital currency was debuted last year, while Ghana’s e-Cedi is currently being assessed.
“The current monetary and financial system in various countries differ. That may affect the level of alignment for a single currency. So indeed, these centralized currencies could diminish gains made, if any, in achieved a single currency,” the Economist added.
Mr. Gospel Obele
Only four African countries have higher proportions of their populations who own cryptocurrency: Kenya (8.52 percent), South Africa (7.11 percent), Nigeria (6.31 percent), and Ghana (3.01 percent).
Ghana’s Digital Currency
The Bank of Ghana recognized the value of digital currency and the numerous advantages it provides to the economy adding that “Digital Currency is part of the central bank acknowledging the need for digital payment and digital delivery of financial services. By this, the Bank of Ghana will provide a platform on which we can add more value to digital transactions.”
Dr. Ernest Addison, the Governor of the Bank of Ghana, stated that the digital currency that Ghana will shortly embrace will be implemented in three stages.
“The Bank of Ghana is one of the first African Central Banks to declare that we were working on a digital currency looking at the concept of an e-cedi. After the implementation phase, we have a pilot phase where a few people would be able to use the digital cedi on the mobile applications and other applications that are currently running.”
Dr. Ernest Addison
The central bank will review the project’s feasibility in three stages, according to the governor. He stated that digital currency will be used to supplement traditional currency in the economy.
‘I think there is a lot more emphasis on looking at digital money which is backed by the state, backed by the central banks. These private forms of money really are not able to perform the functions of money effectively.”
Dr. Ernest Addison
