Is it possible to trade Forex safely in South Africa? Today I will answer this question. It’s a fact that African countries are currently among the top ten who are regularly searching to find out more about cryptocurrencies and trading, according to Google.
The popularity of crypto is not coming just because of Bitcoin, but rather because in countries where inflation tends to go high, people want to search for other solutions to their problems.
They are also not so sceptical about cryptocurrencies, unlike different continents. Uganda, Kenya and South Africa are the top three countries that search about Forex in Africa and are likely to get into trading.
Bitcoin craze
Hearing about decentralized types of exchange is very appealing to Africa since they see it as an opportunity to do more, not something that serves as a threat. In their case, crypto and Forex would serve as a tool of reducing corruption, which is very high, bring development and make the process faster, and they are hoping it would get the less corrupted government to their people.
From this, you don’t have to ask further why people are so excited about crypto (especially Bitcoin). They are the most interested population to want to adopt crypto as a regular currency.
Nigeria phenomenon
It seems like Nigeria is the main force behind the crypto wave. Their weekly peer to peer volume is twice what it was, going from five to ten million dollars. Imagine how quickly the market grows and what it could bring to the table.
Even though Nigeria has the lead regarding potential, according to reports, South Africa has the highest percentage of crypto owners, around 15%. There are many indications investors are interested in Africa since it is a perfect place for growing the crypto market, which would help many countries evolve.
Challenges
One of the main problems is the Internet, which is very bizarre since Africa has the fastest Internet in the world. The problem isn’t the speed but rather a minimal amount of people who have access to it, since many countries are struggling with poverty. In Africa, around 40% of people are using the Internet almost daily.
The even bigger problem is the fact that there is no regulation of Bitcoin trading in South Africa and the government doesn’t want to release any statement regarding cryptocurrencies.
Despite the interest, there is a ban put on Bitcoin and crypto in general in Africa. Also, you can find only 20 Bitcoin nods on the continent, and that’s a pretty small number considering there are 10267 nods in the world.
What could prompt regulators to act
Investors could be the key to developing a stable crypto market and prompt the government. The whole continent would benefit greatly, and that’s why the regulators have proposed rather harsh licensing, but still without considering crypto legal to trade. This seems like a negative thing, but I hope that it will move in the right directions since regulators started paying attention to the market.
Trading and the economy
Still, there are many Forex traders (and other traders) from South Africa, and the best advice would be to search for a certified international broker. The critical thing is to find a certified company since numerous scammers are waiting for someone to fall for the bait.
Please pay attention to inflation in your country since it can often disrupt the trading process. Like I’ve mentioned, having a broker who trades internationally is excellent, but pick someone from South Africa. Nobody knows their own country and what’s going on other than their people.
The currency (ZAR) can still be an issue who are located outside the region and using a different base currency (if they are trading pairs, no crypto).
The fluctuation between currencies such as ZAR and JSE can be a challenge, and something unexpected always can occur.
Fluctuation can be used to your advantage, but only when you become more experienced in Forex. Otherwise, it can reduce your profit and harm your overall trading. The Johannesburg stock exchange can be affected by many international issues, so this isn’t easy to predict.
Conclusion
Although confusing and exciting at the same time, I recommend finding a good broker who knows a lot about the event in and outside the country, first.
Then, if you are a beginner, you can start learning more about Forex in general, how it functions and consult with your broker with everything you know since the regulations are changing all the time. When the time comes, you can start trading safely, as long as you follow what’s going on.
Do you agree with this assesment of Forex in South Africa? Leave a comment below and let me know.
Watch this space for updates in the Opinion category on Running Wolf’s Rant.
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