Bitcoin is a digital cryptocurrency unregulated by a central bank. Its value -- like many real-world currencies -- is determined by how much people are willing to use it. Consequently, its worth goes up and down.
Bitcoin's beginnings —
Bitcoin is a digital cryptocurrency unregulated by a central bank. Its value -- like many real-world currencies -- is determined by how much people are willing to use it. Consequently, its worth goes up and down.
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In 2013, $32 billion was transferred to Africa, or around 2% of GDP, according to the Overseas Development Institute. Much of that was thanks to Money Transfer Operators like Western Union, which has 32,000 registered locations across the continent. On average, these companies charge customers a fee of 12% to send money to Africa.
Cash competitors —
In 2013, $32 billion was transferred to Africa, or around 2% of GDP, according to the Overseas Development Institute. Much of that was thanks to Money Transfer Operators like Western Union, which has 32,000 registered locations across the continent. On average, these companies charge customers a fee of 12% to send money to Africa.
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As Bitcoin is a virtual peer-to-peer currency, designed to operate on the border-less internet, nobody takes a cut from the transaction. This means the costs of transferring money can be cheaper, and could attract customers looking to send money from places like the UK and the U.S. to family and friends in Africa.
Bitcoin abroad —
As Bitcoin is a virtual peer-to-peer currency, designed to operate on the border-less internet, nobody takes a cut from the transaction. This means the costs of transferring money can be cheaper, and could attract customers looking to send money from places like the UK and the U.S. to family and friends in Africa.
John R. Coughlin/CNN Money
Beam is a service in Ghana that converts Bitcoin sent from abroad into the local currency, cedi. Since launching three months ago, it has attracted 30 users who pay a 3% fee on each transaction. The founders say this is cheaper than the average 12% costs associated with traditional transfer services.
Ghana's approach —
Beam is a service in Ghana that converts Bitcoin sent from abroad into the local currency, cedi. Since launching three months ago, it has attracted 30 users who pay a 3% fee on each transaction. The founders say this is cheaper than the average 12% costs associated with traditional transfer services.
The white box on the wall is the only Bitcoin ATM in Africa. It takes the machine, which can be found in a Johannesburg beauty salon, approximately 15 seconds to convert cash into Bitcoins.
The white box on the wall is the only Bitcoin ATM in Africa. It takes the machine, which can be found in a Johannesburg beauty salon, approximately 15 seconds to convert cash into Bitcoins.
A major problem with using Bitcoin is that it is very volatile. Prices fluctuate for a number of reasons, but often more wildly than fiat currencies because of the lack of central regulation.
Erratic value —
A major problem with using Bitcoin is that it is very volatile. Prices fluctuate for a number of reasons, but often more wildly than fiat currencies because of the lack of central regulation.
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