53% of South African respondents had little to no knowledge of cryptocurrency, according to a Q1 2022 consumer survey by Merchants.
The survey also found that only 14% of South Africans felt they had a strong hold on the subject of cryptocurrency, while 23% of respondents remained neutral.
The 18 to 24 age demographic were most likely to have a better knowledge of the cryptocurrency, while people who are 25 and older were less likely to have a strong hold on the topic of crypto.
This is where banks can step in. Banks could help people who have no knowledge of cryptocurrency by providing them with information and other related services.
Almost half of the respondents in the survey said they would be more likely to trust and invest in cryptocurrency if it was offered through the bank that they banked with.
When it comes to their money, consumers want relationships built on trust, according to Mat Conn, Group CRO at Merchants.
“There is a real opportunity for banks to get involved in cryptocurrency as it begins to really take off on the continent, rather than waiting until it is more established – by when consumers are likely to have a preferred platform or partner who they have built that trust with.”
Here are five things consumers need to know about cryptocurrency:
What is cryptocurrency?
Cryptocurrency was first heard of in 2009 when the first de-centralised digital currency Bitcoin was created by an entity - either a single person or group of developers - known as Satoshi Nakamoto.
Based on a network that is distributed across a large number of computers, it is a de-centralised digital currency that does not rely on a central authority such as government or a bank.
How does it work?
Blockchain, a type of public ledger technology, is where all cryptocurrency transactions appear and it allows cryptocurrency to act in a de-centralised manner.
Cryptocurrency transactions take place between two digital wallets. The transaction is submitted to a public ledger and awaits for confirmation. Once the miner (the cryptocurrency platform or app) confirms the transaction, the money is transferred to the receiver’s wallet.
How many types of cryptocurrency are there?
In total there are 16 961 cryptocurrencies, according to Coin MarketCap. Some of the cryptocurrency names that you may recognise include bitcoin, ethereum and dogecoin.
Can cryptocurrencies be hacked?
Yes, but it depends on the cryptocurrency. Bitcoin is considered to be one that cannot be hacked because its blockchain is continuously monitored. However, cryptocurrency wallets and other platforms that handle cryptocurrency can be hacked.
Who can own a cryptocurrency?
The answer to the above question is anyone. Famous people that own cryptocurrency include tech entrepreneurs, famous musicians and even actors.
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