PwC-Emurgo Africa Report
Emurgo Africa and PwC, one of the leading global accounting firms, proudly unveil the highly anticipated State of Web3.0 Report.
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Emurgo Africa and PwC, one of the leading global accounting firms, proudly unveil the highly anticipated State of Web3.0 Report. This groundbreaking publication showcases the exponential growth of the global blockchain industry. Investors are keen to fund blockchain startups and companies, having injected approximately USD 88.5 million in Kenya, Nigeria and South Africa in 2021.
Web 3.0 technologies are experiencing exponential growth and expansion in Africa, with the potential to bring transformative change to various industries such as trade and industry, financial services and lending, supply chain management and logistics and healthcare provision and accessibility.
EMURGO Middle East & Africa (MEA) launched in October 2021 as a part of EMURGO’s initial USD 100 million ecosystem investment vehicle on Cardano, one of the world’s biggest public blockchains. Originally EMURGO Africa, the investment grew to become EMURGO MEA reflecting the huge opportunity for blockchain adoption and growth in the Middle East. Upon its inception, EMURGO MEA partnered with pan-African venture builder Adanian Labs and started the Adaverse Cardano accelerator program in Africa to begin identifying, supporting, and incubating local blockchain talent.
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Cardano is one of the largest open-source blockchain platforms that started its development in 2015 and formally launched in 2017, aiming to be a decentralized application development platform with a multi-asset ledger and verifiable smart contracts. It is THE blockchain platform for innovators and visionaries, to create positive changes to the world.
EMURGO, a co-founding entity of Cardano, has focused on providing the tools and resources necessary for developers, startups, and organizations to build unique and impactful Web3 products and services leveraging Cardano.
Being the former CEO of EMURGO Japan, I have personally spent many years driving awareness of blockchain technology to expand the Cardano ecosystem in developed countries. By fostering dialogue with top executives from global companies and government officials on the unique values of blockchain technology, EMURGO has established and nurtured relationships with key stakeholders in various major countries around the world.
While we have pursued the expansion of the ecosystem in developed countries, Africa has always been our primary focus since inception. In Africa, we aim to position Cardano as the standard open-source blockchain platform for adoption by entrepreneurs and organizations to develop decentralized products and services that can provide access to basic economic services for the 1 billion that currently lack this access..
At the beginning of 2021, we established EMURGO Middle East & Africa (Dubai) and its regional entity EMURGO Africa (Kenya), to focus our resources on developing the region’s blockchain market.
Thus far, we have established subsidiaries/joint ventures such as Adaverse (Africa-focused accelerator), and EMURGO Kepple Ventures to increase our visibility and reach, and also work together with other top-tier business stakeholders in the region. Thank you for your interest, and we are pleased to get connected with partners that can share our vision to build the next digital era together.
Co-CEO of EMURGO Middle East & Africa
CEO of EMURGO Kepple Ventures
Web3 Soft Power: New Era of African Revolution
The advent of Web3 technology is not only revolutionizing the digital landscape in Africa but also unlocking the continent's untapped potential as a hub of soft power influence. While the concept of leapfrogging technology is often associated with Africa, the notion of Web3 Soft Power goes beyond mere technological advancements. It encompasses the transformative impact of Africa's Web3 services and innovations, not only on its own underdeveloped infrastructure but also on the global stage.
Venture capitalists have taken notice, with our experience of over 40 investments executed in Africa, reflecting the rapid growth of the tech industry on the continent. The emergence of two Web3 unicorns recently is a testament to Africa’s expanding influence, further fueled by a remarkable increase in venture capital inflows, 1.8% of the global total, from a meager 0.3% in 2021. This staggering growth rate of 429% demonstrates the growing recognition of Africa’s potential as a driving force behind Web3 innovations and the Web3 funding across Africa from 2021 to 2022 recorded 1,668% growth.
Catalytic platforms like NODO Product Community, founded by EMURGO Africa recently, play a pivotal role in fueling this movement, fostering collaborations and connections that further accelerate Africa's ascent as a Web3 powerhouse. As Africa's Web3 Soft Power continues to gain momentum, the continent's influence and transformative potential are poised to reshape the global landscape, creating a more connected and inclusive digital future for all. We believe Africa’s further growth and it is the center of Web3 Soft Power.
Co-CEO of EMURGO Middle East & Africa
Director of Adaverse and Executive Director of NODO
Blockchain has just begun scratching the surface of what it can do for the African continent. The IFC estimates that 230 million jobs in Sub-Saharan Africa will require digital skills by 2030. That’s a $130 billion opportunity to train the future workforce in digital skills.
2.7 billion people globally don’t have access to the internet. That’s one-third of the world’s population. The majority of which are in Africa. 40% only of which have access to the internet. In comparison, 64% in Asia and the Pacific, 80% in the Americas, and 89% in Europe.
We launched EMURGO Africa approximately one year ago, out of our deepest conviction in the impact the power of blockchain can have on providing equitable opportunities around the continent. When just under 50% of the population is banked, is connected to the internet, and possesses mobile phones, we cannot disregard the opportunity blockchain creates, in leveraging the sheer human capital throughout the entire African continent. From fintech: liquidity provision, lending, and trade to climate change mitigation through on-chain transparency, logistics, inventory management, and supply chain of goods and services, to creating identities and providing accessible health care services for the unbanked, the use cases are endless.
In bridging the traditional defacto financial, trade, and infrastructure systems with new-age blockchain-driven advances in finance, trade and infrastructure, and data processing, we foresee an economic, social, and environmental revolution.
This is why we have come to Africa.
In the last year, we have invested in over 40 African startups, are building on-chain solutions for leading Fortune 500s, and financial institutions, and are facilitating the cross-border growth of novel change-making concepts that legitimize the informal economy and give its citizens rights in possessing an identity, accessing adequate healthcare and building financial capabilities.
It is not in replacing old systems that we seek to create value, it is rather in bridging traditional systems with novel, more efficient, and more sustainable ones. Thus creating equitable, fair, and progressive societies with access to the basic rights of education, financial literacy, and access to healthcare, safety, housing, and nutrition.
This is just the beginning of the blockchain revolution in Africa. Thank you for taking the time to know more about what blockchain can do for Africa and Africans.
Ahmed M Amer
Chief Executive Officer
EMURGO is keen to understand the Web 3.0 landscape in three target markets, Kenya, Nigeria and South Africa, in order to continue identifying, supporting and incubating blockchain and Web 3.0 talent in these countries. The three countries were selected due to their high uptake of Web 3.0 technologies and ongoing stakeholder conversations regarding policy development and regulation of digital currenciesBlockchain and Cryptocurrency in Africa
Blockchain funding in Kenya, Nigeria and South Africa
Kenya, Nigeria and South Africa received a total of USD 88.5 million (70%) of blockchain funding in Africa in 2021.⁵
Blockchain venture funding
growth in Africa
Blockchain funding in Kenya, Nigeria and South Africa 77% Kenya, Nigeria and South Africa received a total of USD 88.5 million (70%) of blockchain funding in Africa in 2021.9
Investors continue to increase the capital injected into African companies creating solutions involving Web 3.0 technologies.
Despite this continued investment in such companies, Standard Bank noted that Africa received only 0.5% of total global blockchain funding. This figure is expected to grow as more companies aim to solve problems faced by the continents inhabitants.
One such challenge is a largely unbanked population (approx. 57%), with cryptocurrency companies such as Canza Finance providing solutions to this end.
Blockchain and crypto Assets are increasing in popularity across the African continent: the adoption of blockchain technology is slow but progressive, while the cryptocurrency market is growing significantly. According to Chainalysis, Africa’s cryptocurrency market grew by over 1200% between 2020 and 2021, with Kenya, Nigeria, South Africa and Tanzania ranking in the global top 20 for crypto adoption.⁸ Although the increasing adoption of cryptocurrency has its advantages, the widespread use of unregulated digital currencies poses a threat to the continent’s financial system. On the other hand, transparency and decentralisation, some of the inherent properties of Blockchain technology, give blockchain the potential to solve challenges that are widespread across the African continent. Such challenges include: international remittance, financial inclusion, and land registration.
There are immense opportunities for the African continent through the adoption of Web 3.0 technologies, including a staggering 1,668% increase in investment in blockchain technology in Africa between 2021 and 2022, signifying the crucial importance of collaboration between industry stakeholders, policymakers, and regulators in fostering an environment conducive to the growth of Web 3.0 technologies. The major case studies of blockchain & cryptocurrency adoption in the continent include financial services with Fingo Africa, trade, education & energy.
The State of Web3.0 in Kenya
The Web 3.0 environment in Kenya is still developing and evolving. As of January 2022, only 42% of the population had access to the internet, which indicates a significant digital divide and limited access to Web 3.0 technologies such as the semantic web. However, there are some signs of Web 3.0 growth and progress. The number of internet users has been steadily increasing and there has been growth in the use of mobile devices and broadband connectivity. This has enabled more people to access Web 3.0 technologies and services, such as online shopping and e-commerce platforms.
The State of Web3.0 in Nigeria
Nigeria has a growing number of blockchain startups and organizations, such as the Stakeholders in Blockchain Technology Association of Nigeria (SIBAN). A report by the CBN, ‘Nigeria Payments Systems Vision 2025’, noted that the CBN seeking to engage relevant stakeholders to utilise blockchain technology for the review and implementation of remittance solutions.²⁵ The blockchain landscape in Nigeria is therefore growing and evolving, with more businesses and organisations, both in the private and public sphere, exploring the potential of this technology.
State of Web3.0 in South Africa
Web 3.0 in South Africa is characterised by the increasing use of AI and machine learning technologies to enhance user experiences and automate processes. One key trend is the rise of dApps and blockchain technology, which are being utilised by a variety of industries in South Africa for secure and transparent data management and transactions. For instance, the agricultural sector is using blockchain technology to track and trace the origins of produce, ensuring food safety and supply chain transparency. Additionally, South Africa is seeing a growing trend of personalisation and customisation of online experiences, with companies using data analytics and AI to tailor their products and services to individual user preferences. This is evident in the rise of personalised e-commerce platforms and personalised content recommendations on social media platforms. Overall, Web 3.0 in South Africa is driving the adoption of advanced technologies to improve user experiences and enhance efficiency in various industries.
The State of Web3.0 in Egypt
The blockchain regulatory landscape in Egypt is currently in a state of development and evolution. However, the trading of cryptocurrencies is explicitly banned. In 2017 the Egypt’s Financial Regulatory Authority (FRA) issued a statement warning against the risks of investing in cryptocurrencies and ICOs, and advised investors to exercise caution when considering such investments.