The recent CVVC report on Africa, entitled “African Blockchain report Q1 2023-Q2 2024,” included some key insights on the growth of blockchain and crypto on the African continent. Despite the slowdown in overall VC funding in Africa in 2023, Web3 startups in Africa had the highest share of Blockchain Venture deals ever at 1.8% in Q1 2024, up from 1.3% in 2023.
The biggest investments went into Fintech, logistics, mobility, and cleantech. In H1 of 2024, Blockchain businesses raised $34.7 million across 12 deals. In 2023, blockchain venture funding in Africa represented 6.1% of all sector venture funds and 5.4% of total deals in 2023.
However, Africa’s share of global blockchain venture funding decreased to 0.6% in H1 2024.
Interestingly, blockchain secured 6.1% of all venture funding in 2023, down from 15.1% in 2022. Seychelles and South Africa contribute 95% of all blockchain venture funding, with ten deals across Africa in 2023. The annual median deal size in Africa is $1 million, but in 2024, the median deal funding size for African Blockchain funding was $2.2 million.
Blockchain venture funding in Africa is bigger than global percentages
One thing that blockchain in Africa is doing better than globally is that blockchain venture funding accounts for 6.4% of all venture funding and 12.5% of total deals, while globally, blockchain funding accounts for 3.5% of all venture funding and 5.9% of total deals.
Africa already has three private blockchain unicorns. Its most recent unicorn status was in 2023 with Scroll, an L2 network built by Ethereum developers for Ethereum developers. It was preceded by the Kucoin and Bitget crypto exchanges.
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Nigeria and Seychelles have the biggest numbers of blockchain deals
Nigeria and Seychelles are the countries in Africa leading in terms of blockchain deals in the first half of 2024, with five for each country, followed by Egypt with one, Kenya with one, and South Africa with one as well. The biggest deals are targeted towards centralized financial services, DeFi, Blockchain networking, and NFTs.
Also Read: African countries go crazy for the BRICS
So far, early-stage investment makes up the biggest investors in Africa, at 54.8%, followed by late-stage investment at 22.3%, seed round investment at 9.2%, and accelerator incubators at just 0.5%.
The biggest funding round ever went to Scroll, which raised $50 million. It was followed by Beldex, which raised $28 million; Carry1st, which raised $27 million; and Seedify and Bitget, which both raised $10 million.
Blockchain and Crypto entities are supporting Africa
More and more blockchain companies and firms are entering Africa in a bid to support the growth of blockchain and crypto on the continent. For example, Bybit notes in the report that it has partnered with local companies Ovex and Yellow Card to grow crypto trading. In addition, Bybit recently acquired its license in South Africa.
Africa has also witnessed the entrance of Zarp Stablecoin, Lisk, Tether, and even the Swiss nonprofit organization, The Hashgraph Association, which is promoting the Hedera DLT Network. In Tunis, THA collaborated with DAR Blockchain to nurture projects, facilitate growth, and educate Web3 talent.
During GITEX 2024, The Hashgraph Association signed several partnerships with governmental and private sector entities in Morocco, such as Agency of Digital Development (ADD) aiming to strengthen citizen services using DLT and Web3 technology as well as with Moroccan UM6P Ventures, an early-stage venture capital firm and the investment arm of UM6P (Mohammed VI Polytechnique University), whose mission is to develop entrepreneurship and accelerate science innovation in Morocco and Africa.
Also Read: The Hashgraph Association Partners with the QFC to launch a $50 million Digital Assets Venture Studio in Qatar
Kamal Youssefi, President of The Hashgraph Association, noted at the signing with ADD, “ I strongly believe that digital tools including the Hedera network technology, blockchain, AI, IoT, and Web3 are here to serve the economies, societies, and youth of these countries. This partnership holds immense importance as it will initiate a journey of enablement and sustainability fostering strong relationships between the African and European continents through technology and innovation.”
Cryptopolitan reporting by Lara Abdul Malak
