While Bitcoin’s slump and bearish price action have caused a drop-off in South Africans buying cryptocurrency, the surge in users and trading volumes during the past year was astronomical.
“We’ve seen a slight slow down in growth in Q1 2022, but this is after we grew over 450% in Q4 2021 — so it’s probably to be expected across the crypto industry,” Revix founder and CEO Sean Sanders told MyBroadband.
Revix is a cryptocurrency investment service that lets customers buy bundles of assets in addition to individual digital coins.
“The first few months of the year are also usually the slowest when dealing with retail investors as people have less discretionary income after the holiday season.”
Sanders said that Revix saw roughly 50% growth between the first quarters of 2021 and 2022, and 500% growth when comparing 2020’s numbers.
“Monthly volumes grew from around $2 million (R31.7m) in 2020 to over $70 million (R1.1 billion) in 2021.”
Cryptocurrency exchange VALR also reported significant growth.
VALR co-founder and CEO Farzam Ehsani told MyBroadband that they grew from 85,000 customers at the beginning of last year to over 275,000 this year.
“VALR processed just over R3bn in 2019, R27bn in 2020, and R78 billion in 2021,” Ehsani said.
AltCoinTrader’s David Porter said that they see an influx of users whenever there are big movements in cryptocurrency prices — up or down.
Porter said that looking at figures from just the past few months doesn’t paint a complete picture as the cryptocurrency market has been trading sideways since December 2021.
However, he did reveal that AltCoinTrader was signing up around 20,000 new users per month at the end of 2021 and the beginning of 2022.
This is up from roughly 5,000 new monthly sign-ups in 2019.
Porter said that AltCoinTrader’s user base is compounding at 45% per year — effectively doubling every two years.
They currently have over a million users registered.
“We have witnessed parabolic growth over the last few years. While we would prefer not to be specific about volumes, we have effectively been doubling the total ZAR value of our total trades each year since 2019,” said Porter.
Luno’s general manager for Africa, Marius Reitz, also did not wish to disclose trading volumes, saying it was a poor indicator for cryptocurrency growth and adoption in South Africa.
“A few traders on Luno drive volume, and it’s not indicative of the increasing involvement of South Africans in crypto,” Reitz stated.
Luno recently announced that it now has over 10 million customers in over 40 countries.
It grew from 9 million to 10 million in six months, and around 400,000 of these were based in South Africa.
“South Africa is one of Luno’s strongest and most active markets. Customer growth in South Africa is almost 40% year-on-year,” Reitz said.
“Over 40% of the new customers added in the last six months are based in South Africa, which is one of our strongest markets.”
Luno’s data shows that, on average, South Africans deposit R480 when they open their Luno account and tend to hold it for ten months.
Reitz noted that this is the longest average holding period of all Luno markets.
“This is much longer than two years ago, with the exception of traders, who would naturally be more active,” he said.
“Overall, this indicates that South African customers increasingly view crypto as a longer-term investment and are not necessarily buying it to make a quick buck.”
Reitz said that most customers start with a relatively small deposit, while the top 25% of its biggest local customers start buying cryptocurrency with around R1,500.
“The highest deposit amount among our smallest 25% of customers is only around R90,” said Reitz.
“These metrics indicate that South Africans are investing in crypto responsibly.”