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Bitcoin and Crypto’s effect on investment in Africa vs Europe

Bitcoin and cryptocurrencies have become particularly popular in 2020 and 2021, with their market capitalization soaring. As a result, many private and even institutional investors today are looking to explore the world of crypto investment. Depending on where you are in the world, these approaches will vary. Africa and Europe are two distinctly different worlds…

(FILES) In this file photo taken on July 19, 2021 this illustration photograph taken on July 19, 2021 in Istanbul shows a physical banknote and coin imitations of the Bitcoin crypto currency. – Bitcoin soared 10 percent to top $38,000 on July 26, 2021. (Photo by Ozan KOSE / AFP)

Bitcoin and cryptocurrencies have become particularly popular in 2020 and 2021, with their market capitalization soaring. As a result, many private and even institutional investors today are looking to explore the world of crypto investment. Depending on where you are in the world, these approaches will vary.

Africa and Europe are two distinctly different worlds both politically and economically. This creates different investment opportunities for sure. Europe is a little more conservative in its investment due to, and causing, the continent’s wealthy status.

Countries such as Germany sit atop a gigantic economic surplus that some have criticized as selfish. Conversely, Africa has frequently explored higher-risk investment opportunities. Today this takes the form of crypto currencies such as Bitcoin, Ethereum, and even Dogecoin.

These assets entail a much bigger risk but they make sense for African investors as they are somewhat used to greater currency fluctuations and overall uncertainty. Additionally, crypto investment for many Africans is a way to circumnavigate what we largely regard as poor local fiscal and monetary policies. Policy that is often seen ultimately as harming consumers, stifling growth and making it harder to turn your efforts at work into something worthwhile.

Crypto Investment in Europe: Who Does It and How Often?
Individuals and institutions who invest in cryptocurrencies are split on the focus of their investment. Some companies and individuals are keen to buy up Bitcoin and other high-value cryptocurrencies as well as invest in mining, which is particularly important to companies that want to get ahead of events and utilize their spare capital to bring in more money.

So, these are the investors and strategies that focus on developing crypto and Bitcoin a little further. Then you have the second type of investors who are far keener on exploring the underpinning technology, i.e. blockchain. Blockchain brings in some excellent value for the end-consumer and businesses.

Thanks to this technology, processes are automated and secured as there could be no human error in the public ledger which automates shipments and other transactions that save time, effort and boost precision and productivity.

Europe is for now more open to embracing blockchain as its go-to investment option. Cryptocurrencies and digital currencies seem a good idea up to a point. For example, the European Central Bank (ECB) is working on a digital currency project that will supposedly run parallel with the euro in a bid to create more stability and help the European Union move towards a single currency online that allows it to embrace innovation.

How about Crypto Investment in Europe?
Crypto investment in Europe is a slightly different kind. There are still the big technological leaps that drive the industry forward as a whole, naturally, but there are also the higher-risk investments. Many interesting cryptocurrency developments in Europe center around France. Often thought of as Europe’s digital and innovative hub, French’s companies and individuals seem interested in jumping into the cryptocurrency market, but not in the same way as African investors.

French companies and private individuals seem fairly reluctant to buy into cryptocurrencies as an asset. The curiosity appears to be there, but conservative investment culture means many are simply looking into the possibility but not pulling the trigger. It seems that bitcoin isn’t the favored crypto option for many european and french investors.

Dogecoin or Shiba Inu are two perfect examples of how people in the continent are always going to seek and try to ensure that they are ahead by simply opting for the assets they think would go up. These two currencies are not simply pure speculation. Dogecoin and Shiba Inu have similar traits to Bitcoins in France, as they serve as a powerful payment medium that can be used for anything from groceries to banking, to entertainment such as online casinos. FIAT payments may be the norm, but Bitcoin entertainment and purchases are becoming far more common than you think.

Europeans seem to have more FIAT reserves and they are reluctant to risk them on digital currencies, but the immense gains they could extract by putting a small amount on crypto are still tempting.

Of course, much of this is rooted in speculation rather than hard, cold facts, which is another reason for concern. Then again, treating your investment money as something you can risk and lose is the best policy to becoming a successful investor.

Which Model Is More Sustainable?
In terms of sustainability, there are several things to consider here. To make it easier to follow through, we will simply list them as bullet lists:

  • Long-term goals
  • Return on investment
  • Moving with new technology

Each of these is an important factor to consider when it comes to sustainability and long-term prospects. Of course, some options promise a BIGGER potential return which is what tempts many people to stick with that option over another.  

Ultimately, whether you invest in Europe or Africa, you ought to consider your own specific needs and not cave in to pressure as to what may or may not be popular among investment communities.

 

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