African blockchain startups outpaced VC landscape in 2024: report
In 2024, blockchain startups in Africa outperformed the rest of the market, capturing 13% of all deals on the continent amid contracting VC funding to African ventures.
Blockchain startups captured 7.4% of all venture funding, a slight rise from 7% the previous year, revealed the 2024 Africa Blockchain Report by Swiss blockchain venture firm CV VC and pan-African banking giant Absa. The share of the deals nearly doubled from 7.3% in 2023.
Most impressively, the median deal size for the sector hit $2.8 million, twice the industry median, 'reflecting investor willingness to make high-conviction bets even amid risk-off conditions.' However, the average deal size dipped 44% to $4.1 million.
The report revealed that investors are shifting from startups developing protocol-level infrastructure to platforms focused on utility. DeFi, data infrastructure providers, and startups offering digital currency-fiat financial services dominated the fundraising.
The report also reiterated the rise of stablecoins on the continent.
'It is probable that within a decade, more Africans will use stablecoins for daily transactions than hold traditional bank accounts,' commented CV VC CEO Matthias Ruch.
Yellow Card, an exchange whose business model now leans overwhelmingly on stablecoins, had the region's biggest funding round, raising $33 million in October. The round, led by Blockchain Capital, brought its total funding to $88 million, making it Africa's highest-funded exchange. Source: CV VC
But while blockchain startups outperformed their peers, Africa's startups only attracted $122.5 million last year, translating to 1% of the $12.1 billion raised globally, down from 1.8% the year prior. Overall, African startups raised $2.6 billion across 427 deals, a separate report revealed.
'This is not just an imbalance; it's an opportunity. An invitation to investors, developers, policymakers and innovators to engage with one of the most promising blockchain frontiers on the planet,' Ruch added.
The G20 must focus on blockchain: Absa
As blockchain outpaces most other technologies, it must remain a central part of conversations around development in Africa, including at the upcoming G20 Summit, says Rob Downes, Absa's head of digital assets.
The G20 Leaders' Summit will be held in November in Johannesburg, the first time the event is being held in Africa. It will host the world's most powerful leaders to discuss pressing global issues, including the digital economy, with AI, data governance, and cybersecurity among the themes.
With blockchain outpacing all these sectors in funding growth last year, it must be a key area of focus for the G20 leaders, says Downes.
'It certainly isn't farfetched to see a future world where digital money lives on blockchains, with AI tooling monitoring real time activity and patterns to detect and prevent fraud, money laundering and terrorist financing, and money transfers happening seamlessly when pre-agreed conditions are met,' he added.
Blockchain adoption in Africa has recorded steady growth, unfazed by the funding or the cyclical booms and busts in the digital currency sector. Dozens of startups have developed blockchain solutions addressing challenges around financial inclusion, supply chain management, and intra-African trade, cross-border transfers, document authentication, and more.
Watch: The next big thing? Discover startups making waves at Block Dojo Cohort 10
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Reuters
5 hours ago
- Reuters
Rwanda, Congo agree on outline for economic framework as part of peace deal
WASHINGTON/PARIS, Aug 1 (Reuters) - Rwanda and the Democratic Republic of Congo on Friday agreed on an outline for the regional economic integration framework, according to the U.S. State Department, as the two countries take steps toward delivering on a peace deal signed in Washington last month. The tenets agreed on Friday summarize the framework, which includes elements of cooperation on energy, infrastructure, mineral supply chains, national parks and public health, the State Department said in a statement. Rwanda and Congo signed a peace deal in Washington in June at talks held by U.S. President Donald Trump's administration, which aims to bring an end to fighting that has killed thousands and attract billions of dollars of Western investment to a region rich in tantalum, gold, cobalt, copper, lithium and other minerals. As part of the deal, Kinshasa and Kigali agreed to launch a regional economic integration framework within 90 days, the agreement said. A source familiar with the matter said a preliminary draft of the framework has been agreed to and there would now be an input period to get reaction from the private sector and civil society before it is finalized. The framework is planned to be signed at a meeting of heads of state at the White House. No date has been set yet for that meeting, the source said. In the Friday statement, Rwanda and Congo affirmed that each country has "full, sovereign control" over the exploitation, processing and export of its natural resources and recognized the importance of developing mineral processing and transformation capacity within each country, according to a copy seen by Reuters. Kinshasa views the plundering of its mineral wealth as a key driver of the conflict between its forces and Rwanda-backed M23 rebels in eastern Congo. Reuters reported in May that Congolese minerals such as tungsten, tantalum and tin, which Kinshasa has long accused neighbouring Rwanda of illegally exploiting, could be exported legitimately to Rwanda for processing under the terms of the deal being negotiated by the U.S., according to sources. The two countries are committed to ensuring that the minerals trade no longer provides funding to armed groups and to create a world-class industrial mining sector in the region, as well as to ensure better cross-border interoperability on mineral supply chains, according to the statement. They also agreed to connect new infrastructure to the U.S.-backed Lobito Corridor, underscoring Washington's aim of greater access to resources in the region and efforts to counter China. The Ruzizi III hydropower project and Lake Kivu methane exploitation were the only specific projects mentioned in the statement, despite U.S. emphasis on critical minerals. The countries said they intended to prioritize financing for Ruzizi and work together to exploit the methane gas sustainably. Friday's announcement comes after the two countries held the first meeting of a joint oversight committee on Thursday in a step toward implementing the Washington peace deal even as other commitments are yet to be fulfilled. In the Washington agreement, the two African countries pledged to implement a 2024 deal that would see Rwandan troops withdraw from eastern Congo within 90 days. Congolese military operations targeting the Democratic Forces for the Liberation of Rwanda (FDLR), a Congo-based armed group that includes remnants of Rwanda's former army and militias that carried out a 1994 genocide, are meant to conclude over the same timeframe. The deal also said Congo and Rwanda would form a joint security coordination mechanism within 30 days and implement a plan agreed last year to monitor and verify the withdrawal of Rwandan soldiers within three months. But 30 days from the signing has passed without a meeting of the joint security coordination mechanism. The source familiar with the matter said the joint security coordination mechanism meeting would be held on August 7 in Addis Ababa. Congo is also involved in direct talks with M23 hosted by Qatar, and last month the two sides pledged to sign a separate peace agreement by August 18, though many outstanding details need to be negotiated.
Finextra
10 hours ago
- Finextra
How long before the GENIUS Act helps your business run faster and cheaper?
0 This content has been selected, created and edited by the Finextra editorial team based upon its relevance and interest to our community. If you conduct business internationally to or from the US, you might be able to save a lot of money, especially on cross-border payments - and also get those payments done much more quickly - in the near future thanks to stablecoin adoption. Even better, with blockchain encryption and security in place for everyone, it could be safer and easier to manage than traditional payment practices. That's what fiat-backed stablecoin promoters and providers are promising they'll deliver for global commerce. But, while you should definitely explore potential opportunities, don't count your savings in money or time yet, as it might be a while before all the lofty predictions for 'stablecoins as saviours' to become a reality. How long depends on both political decisions and regulator policies being finalised now and in the coming months – not to mention the required coordination of many 'links' in the stablecoin value chain of system designers and operators, and financial institutions too – though all parties seem to be working hard to move the needle forward on stablecoin adoption as quickly as possible. Stablecoin traffic already exceeded value of both top card networks combined in 2024 Stablecoin statistics continue to show impressive increases in both volume and value. According to the World Economic Forum, the number of stablecoins in circulation jumped more than 28% year-over-year. Values transferred surpassed the combined totals from both Visa and Mastercard transactions in 2024 – reaching $27.6 trillion in USD equivalent. The US has joined Europe (MiCA) and Hong Kong in passing legislation governing digital assets, while a number of private firms based in the US have either issued stablecoins already or purchased companies who have done so to add to their capabilities. But they might be facing greater hurdles to operation and differentiation as a result of the new definitions and regulations passed into law. Still, when the U.S. Stablecoins Act (GENIUS Act) was signed by President Trump two weeks ago, it was hailed by crypto industry and many financial services and international business advocates as being a revolutionary leap forward for the country and its primacy in worldwide commerce. Bipartisan endorsement in Congress of the legislation signalled broad agreement among many on the potential of stablecoin to cement the US dollar's continuing position at the top of the global financial hierarchy. The GENIUS Act, the initials of which stand for Guaranteeing Essential National Infrastructure in US-Stablecoins, represents the culmination of US efforts to take top prize in the global stablecoin promotion and regulation stakes. It's a one of few measures in a sharply divided Congress that gained support from both major parties, achieving passage in the House of Representatives with about a three-fourths positive vote. In the Senate, the tally was a bit more one-sided as 50 Republicans and 18 Democrats (69% to 31% - with 30 members voting 'no') supported Senate bill 1582's passage and forwarded it to the president. As of July 18, it became the law of the land. Why is the GENIUS Act so popular? Specifically, the GENIUS Act does three things: Defines legal stablecoin issuers as limited to insured depository institutions, e.g. banks, credit unions, subsidiaries of banks and nonbank financial institutions that receive approval from the Federal Reserve and demonstrate the ability to comply with the relevant law. States can also separately qualify and regulate stablecoin issuance within their borders, but only up to $10 billion or less per issuer. Requires holding of 1:1 reserves for any stablecoins issued, in physical currency, demand deposits, US treasury bills, repurchase agreements, or other low-risk assets approved by regulators. These reserves must be reported monthly in terms of portfolio composition and also be audited regularly by 'registered public accounting firms,' according to the official bill summary. Mandates that while 'permitted payment stablecoins are not considered securities under securities law,' all stablecoin issuers must comply with the Bank Secrecy Act, and implement measures protecting against money laundering (AML) and the financing of terrorism (CFT) and bolstering consumer protection. Just like 'standard' payments must do. The Office of the Comptroller of the Currency (OCC) is now the designated regulator of federal qualified payment stablecoin issuers, while the 'appropriate federal banking agency of an insured depository institution is the regulator of a payment stablecoin issuer that is a subsidiary of an insured depository institution,' per opinions on the issue from Sidley law firm. Additionally, foreign issuers of stablecoins may offer, sell, or make available stablecoins using digital asset service providers, though they must be fully vetted by the Department of Treasury as being subject to 'comparable foreign regulations' within their country of origin. How they'll actually be vetted is not yet clear. There might be more than bargained for in the 'whole package' of digital assets bills in DC The GENIUS Act was passed as part of what may end up as a three-bill 'package deal' – as two companion bills (or actually, three with only two likely to survive) have now cleared the House enroute to consideration within the Senate chamber in the coming weeks. Even with stablecoins defined and regulations specified in the US for their issuance, backing, and reporting, there's some confusion still on definitions, regulatory requirements, and oversight plans concerning other digital assets. One bill, called the Anti-CBDC Surveillance State Act reflects lingering disagreement on priorities in government and industry circles. It was passed in the US House of Representatives in early July. It's written to be a counterpoint to conservative concerns about the US developing its own central bank-issued digital currency (CBDC) and thus closely monitoring its use within the marketplace. These worries were described in Kiplinger as surrounding 'government-sponsored blockchains of citizen transactions (perceived as) too close to Big Brother financial surveillance. Hence, the name of the bill includes opposition to both CBDC as well as the 'surveillance state.'" The Digital Asset Market CLARITY Act, now passed by the US House of Representatives on a 294-134 vote and also on its way to the Senate, is the second piece of legislation related to the GENIUS Act boasting wide and bipartisan support. Still, some concerns have been voiced about its investor protections verbiage, as it transfers oversight duties on certain digital assets from the Securities and Exchange Commission (SEC) to the Commodity Futures Trading Corporation (CFTC), among other things. The CLARITY Act 'defines a digital commodity as 'a digital asset that is intrinsically linked to a blockchain system, and the value of which is derived from or is reasonably expected to be derived from the use of the blockchain system.' However, there are divergent views on how to handle crypto assets other than payments on both sides of the political aisle in the Senate. Another bill, the Responsible Financial Innovation Act of 2025 (RFIA) is also under consideration, and it would take a different approach to market regulation and classification of digital assets. The RFIA would establish a larger oversight role for the SEC, over which the Senate Banking Committee has jurisdiction. Though the CLARITY ACT and RFIA overlap in some respects, they still differ substantially. That means there must be a negotiation among Republican leadership and other supporters to choose which will survive the other and be put up to a vote in the Senate – then passed back to the House for approval before finalisation and submission for signature to the president. It's not yet certain just which proposal will win out in the Senate, but it's clear that the approach of the CLARITY Act has broad support outside the legislative chambers and in a number of diverse quarters in the business and financial arena. CLARITY's focus on standards earns support from all corners of crypto world In the words of the nonprofit Decentralization Research Center, the CLARITY Act's 'robust, control-based decentralisation test for digital assets,' would create 'a much-needed standard for evaluating when a digital asset has met a threshold to justify its transition from security to commodity,' which the organisation's leaders call 'an essential step for effective market structure legislation.' The Crypto Council for Innovation, which calls itself the 'premier global alliance for advancing the promise' of digital assets with 'seasoned experts from government, finance, tech and law,' said in its own letter to Congress that 'CLARITY strengthens disclosures, safeguards customer funds, and creates a path for compliant digital asset firms to build in the US. It balances consumer protection with market certainty and brings the US closer to frameworks already advancing overseas.' It's expected that one of these main digital asset regulatory frameworks now under consideration will advance from Congress before the end of the year, and if so, according to Akin Gump law firm, it would represent a major step forward for crypto in the financial world: 'a watershed moment for the industry not just in the U.S., but globally.' How soon will all these (passed or proposed) changes in crypto regulation impact your business? Changes in financial services always take more time than expected. The likely wait for impacts of the GENIUS and its companion bills/laws to start creating more than ripples in the financial services pool is no different. The GENIUS law governing stablecoins in the US doesn't take effect until 2027, and even then, many questions remain about potential changes in the regulation or its implementation – especially in concert with similar laws now in place or being instituted by other countries around the world. These challenges might extend its effective date as much as 120 days further into that year. Still, given what we have been reading constantly in the news regarding the GENIUS Act and its companion pieces of legislation, it's clear that no matter their ultimate forms or frameworks, these landmark digital asset laws will combine to exert a huge influence on future financial services offerings and practices in the US and abroad. Speculation ranges far and wide on just what fiat-backed, blockchain-enabled stablecoins authorised by the US government will immediately and ultimately mean to the payments world in terms of costs, timing, and verification of what will primarily be international transactions – at least to start. Fraud continues to be a concern with stablecoins as with any payment methods, as the fraudsters always seem to find ways to infiltrate nearly every legitimate transaction network designed, no matter what its protections. But, most advocates and even some opponents are hailing what they predict as a much brighter future of blockchain-secured, dramatically reduced cross-border financial transfer timelines, dropping transnational payment execution intervals from multiple days in some cases down to a few minutes or even seconds. They also foresee costs for such transfers being reduced dramatically - from double-digits of USD in expense each - to perhaps only pennies per transaction. As history has taught us, however, the pricing and efficiency of stablecoin payments will be proven in the 'real world' of daily commerce. Complete answers and transparency on actual provider expenses, operational friction, client-realised costs, transaction timing, other benefits, and, of course, potential pitfalls are for now difficult to ascertain in this nascent stablecoin marketplace. Whatever laws ultimately emerge from Congress to join the GENIUS Act's stablecoin rules and regulations, there's no doubt that the legislative and executive branch leaders now in power in the US are doing nearly all they can to encourage the acceptance of crypto and payments to ensure the country's pre-eminence in global financial affairs. It's no surprise either that the virtually exploding crypto industry, feeling the political wind at its back, is happily jumping onboard for the ride. Stablecoin providers all along the value chain – bank, nonbank, and fintech - will surely keep pressing for their offerings to supplant many traditional, and typically slower and more expensive, payment rails and methods in the US and across the globe. We'll know, maybe within a year or two, if they're successful.
The Independent
11 hours ago
- The Independent
Lesotho's textile factories face closures despite US tariff cut
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