BITCOIN: An Exploratory Study Investigating Adoption in South Africa

Raphael W Jankeeparsad, Devi Datt Tewari
Interdisciplinary Journal of Information, Knowledge, and Management  •  Volume 17  •  2022  •  pp. 191-214

This paper identified and explored the factors influencing Bitcoin adoption and use in South Africa.

Since its introduction in 2008, the value and popularity of Bitcoin has risen exponentially. Captivating the eyes of the world, from regulators to economists, Bitcoin promises to revolutionize the digital currency space. Despite being over 10 years old, the concept of cryptocurrency is fairly new in South Africa, a developing country. South African’s interest in Bitcoin continues to grow with the country constantly ranking within the top 10 in online searches for “Bitcoin” and “cryptocurrency” on Google. The primary objective of this research was to identify adoption factors amongst South African citizens, an area that has not received much research focus in the past. In addition to this, the study aimed to identify how Bitcoin is primarily used in South Africa.

A survey-based questionnaire was utilized to obtain responses from adopters of Bitcoin in South Africa. The quantitative survey was completed by 204 respondents.

This research contributes to the body of knowledge relating to Bitcoin adoption, specifically from a developing country. Adoption factors are identified that can be utilized by businesses that intend to adopt cryptocurrency, to strategically prepare for the potential risks or opportunities brought about by Bitcoin and cryptocurrency in general.

The findings of this study indicate that while perceived usefulness, perceived ease of use, subjective norms, and facilitating conditions positively influence intention to adopt Bitcoin, trust was the only construct that is statistically significant and hence is the greatest driver of adoption in South Africa. In terms of its primary use in South Africa, the study revealed that Bitcoin is used as a speculative instrument for short-term trading in South Africa followed by being used as a long-term investment in the crypto-asset class. No respondent indicated that they utilize Bitcoin as a payment method in South Africa.

When developing crypto-based investment products, custodians of assets must ensure that a minimum-security protocol is followed to safeguard these assets. This will enhance the trust that potential investors and customers have in their systems and products.

This study focused on adoption factors for South African citizens. Future studies should be conducted to identify adoption factors by businesses in South Africa.

Bitcoin offers an alternate trading instrument and investment option, with the possibility of large gains over a relatively short period. Bitcoin also presents the possibility of cross-border transactions at a significantly lower cost compared to traditional cross-border transfers of funds.

Studies should be conducted to explore the factors influencing the adoption of altcoins to determine if the technological differences influence the adoption of one currency over the other. Research should also be conducted comparing the taxation of cryptocurrency in various countries around the world.

Bitcoin, cryptocurrency, South Africa
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