Money has evolved over the centuries, from commodity money to metallic money, paper money, credit money, and electronic money. Money, historically, is anything that can be used as a medium of exchange.

Since the inception of Bitcoin — another form of money — in 2009, people have centred in on a new way to transact and exchange value. That comes as no surprise because in truth money is what we say it is.

This article discusses crypto wallets in general and how feasible it is to live a good economic life in South Africa when you own and use one.

 What is a crypto wallet?

Crypto wallets store your private keys —  the password that gives you access to your cryptocurrencies, keeping your crypto safe and accessible. 

They come in many forms. Some are hardware like Ledger (like a USB stick}, others are mobile apps like Coinbase Wallet. Crypto wallets make the use of crypto easy, especially through different crypto trading platforms South Africa. 

How do you use a crypto wallet?

Unlike a normal wallet, which holds real cash, crypto wallets technically don’t store your crypto.

Your holdings live on the blockchain and can only be accessed using a private key. Your ownership of your digital money is proven by your key, and this allows you to make transactions. 

Losing your private keys implies that you lose access to your money. Therefore it’s important to keep your hardware wallet safe or use a trusted wallet provider like Coinbase. The major types of wallets you can choose from include:

Paper Wallets: keys are written to a physical medium like paper and stored safely.

Hard wallets: Keys are stored in a thumb-drive device that is kept in a safe place and only connected to a computer when you want to use your crypto.

Online wallet: Keys are stored in an app or other software – look for one protected by two-step encryption.          

Crypto in South Africa

With the rapid rise in crypto-trade in South Africa and the rise of cryptocurrency trading platforms in South Africa, the daily trading volume exceeds $145 million, making South Africa the fourth country in trade and investment in bitcoin and other cryptocurrencies in Africa. 

Cryptocurrencies aim to cut out the middlemen, such as banks or credit card companies, making it cheaper to transfer money through virtual wallets.

Cryptocurrencies also are not controlled by any central authority, which theoretically protects them from any interference by governments.

Today, South Africa is officially embracing cryptocurrency trade and investment laws. Its financial and capital markets regulators predict an increase in crypto activity in the country. The new regulations aim to foster transparency and minimise the abuse of cryptocurrencies for nefarious activities.

Although you can use your crypto wallet in so many places in South Africa, it is still not entirely sustainable to run a daily life because of a lack of education, and the complexities attached to cryptocurrencies.

Despite these concerns, the future looks bright for crypto wallets and their owners. Issues of the safety and security of crypto wallets are being addressed as top financial regulators in South Africa, including the South African Reserve Bank, released a policy paper with recommendations for the regulation of cryptocurrency.

 Conclusion

Even though it seems too early to say how widely adopted cryptocurrency will become in Africa, cryptocurrency marketers believe it’s something young Africans should consider.