Bitcoin Lightning Network will be used in fiat transfers between EU and Africa

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The ongoing crypto winter is not stopping the industry from pushing for global adoption and accessibility. A new partnership between CoinCorner and Bitnob paves the way for users on all continents to conduct cross-border transactions involving multiple fiat currencies.

Typically, transferring funds between Europe and Africa requires a third-party facilitator like Western Union, which relies on centralized entities. These deals often have multiple-party processing times before approval and are known for costly discounts. The World Bank estimates that remittances to sub-Saharan Africa have increased by $40 billion a year from 2020, with Nigeria alone receiving almost half of the amount.

Now, users can transfer funds through the Lightning Bitcoin (BTC) network from the UK and Europe to select countries in Africa. The application, Send Globally, allows the transfer of British Pounds (GBP) or Euros (EUR) to the local currencies of Nigeria (NGN), Kenya (KES) and Ghana (GHS).

Using the Lightning Network, funds are automatically converted to BTC, then instantly converted to local currency and deposited directly into the recipient’s bank account or mobile money wallet.

Sending money to Africa, especially from the UK and Europe, is notorious for its high cost. Source: IFAD

Danny Scott, CEO of CoinCorner, said the remittance market is a great opportunity to highlight the utility of BTC.

The borderless nature of Bitcoin has always made it a great tool for sending money around the world, but now with the Lightning Network, sending Bitcoin is instant and very low cost.

In 2021, data from Statista placed Nigeria in the top 10 countries for remittance payments. Additionally, the World Bank reported that last year Sub-Saharan Africa accounted for 14.1% of global remittances.

However, almost 80% of African countries restrict the type of institutions able to offer local banks remittance-related services. Such exclusivity creates barriers to entry, and therefore to access to financing for those who need it most.

Related: Remittances Drive Uneven But Rapid Crypto Adoption In Latin America

The prevalence of cryptocurrencies in Africa has been a hot topic in the space, as the continent is full of emerging economies and practical use cases.

Particularly in North Africa, the growth of the crypto industry continues to grow. A report by Chainalysis revealed that the Middle East and North Africa (MENA) region is the fastest growing in the world.

In September, the Nigerian government held meetings with Binance to possibly negotiate a special economic zone to support crypto and blockchain-related businesses in the region.

A subsequent report by Chainalysis also highlighted Ghana’s rise to prominence in the crypto space. He said the country could potentially catch up with Nigeria and Kenya in terms of crypto adoption.

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