According to a Techcrunch report, the bankrupt cryptocurrency exchange FTX was processing billions of dollars in Africa each month and planned to open an office there to expand its operations there.
The study claims that FTX saw Africa as a region of priority and that the purpose of its commercial operations there was more than just to boost overall volume.
In November 2021, the exchange led Chipper’s $150 million series C expansion, its first investment in an African business.
Sam Bankman Fried, the CEO at the time, claimed that sending money across the continent was expensive and time-consuming.
Unsurprisingly, according to Sam Bankman-Fried, it is the market with the quickest growth due to widespread cryptocurrency usage.
Chipper was not exposed, according to the report, even though Nestcoin, a different FTX investee, had money in FTX prior the bankruptcy.
The following companies are not revealed: VALR, AZA Finance, Bitnob, and Mara, which in May 2022 raised $23 million from a number of investors, including Alameda Research.
Fascinatingly, as a condition of their investment, some of the investees may have been required to hold their assets on the FTX exchange.
Before its death, the exchange had amassed more than 100,000 customers in Africa, many of whom utilized the site to trade, while others did so to exchange local money for dollars and increase the yield on their investments.
Additionally, the company employed 30 campus trading ambassadors under a contract to promote the business and onboard consumers in schools and universities, as well as three full-time employees in Africa who worked remotely. Due to the company’s insolvency, these people are currently in a difficult situation.
It’s not even a joke, according to a tweet from Harrison Obiefule, the PR and marketing manager for FTX in Africa.
Simply put, I’ve been too dazed to talk. I’ve been getting calls and threats 24/7 from strangers, family members, and celebrities. The effects have only just started to manifest.
Along with FTX staff, people who held money on the exchange are also calculating their losses; some of them lost decades’ worth of investments.
Victor Asemota, a well-known opinion leader in the Nigerian tech sector and a steadfast supporter of FTX in Africa, said, “All my UK ISA Individual Savings Account, which I saved over the previous 15 years, was what I lost.”
Asemota thinks that the bankruptcy of FTX will probably give Nigeria’s hawkish authorities more room to maneuver, and he expresses concern for crypto firms doing business there.