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P2P crypto trading volumes continue to rise in Egypt despite central bank warning

By on April 24, 2021 0

P2P crypto trading volumes continue to rise in Egypt despite central bank warning

Crypto trading volumes in Egypt surged in the first quarter of 2021, mostly driven by investors under 34.

The recent warning from the Central Bank of Egypt on cryptocurrencies such as Bitcoin (BTC) and Ethereum (ETH) has not deterred investors in the country from investing in the asset class. Recent data shows that crypto trading volumes on P2P platforms in Egypt actually skyrocketed in the first quarter of 2021.

A market report from Localbitcoins found that weekly crypto trading volumes averaged $ 205,000 in the first three months of 2021, according to Bitcoin.com. P2P data also revealed that traders under 34 are the main drivers of the recent surge in activity in the crypto market.

However, buying cryptocurrencies in Egypt is not cheap as buyers often have to pay a premium on top of the spot price of digital currency. For example, while Bitcoin traded just under $ 57,000 on March 16, 2021, on most international exchanges BTC was trading at $ 64,000 in Egypt.

Egyptian traders are likely to ‘seek additional sources of income (either through) trading or bitcoin’, which could explain why cryptos remain popular in the country despite the central bank warning and the high premium , according to a video shared by a P2P platform. Cryptocurrencies could be a practical alternative for those without access to traditional financial services, given that around 67% of Egypt’s adult population is still unbanked.

The Central Bank of Egypt has issued a warning expressing concerns about cryptocurrency trading. The monetary authority pointed out that digital assets such as Bitcoin (BTC) are highly speculative and, therefore, volatile.

“Cryptocurrencies are generally characterized by fluctuations and significant price volatility; as their global speculations are completely unregulated, a fact which makes investing in them quite risky and highly speculative, and are likely to result in sudden losses of all their value ”, the CBE wrote.

The CBE also pointed out that cryptos are not guaranteed by any government. “It should be noted that cryptocurrencies are not issued by any central bank, nor by any official central issuing authority that can be held responsible,” the monetary authority added. “In addition, cryptocurrencies are not backed by any tangible assets and are not overseen by any regulator in the world, and therefore, they do not enjoy the official government guarantee and support enjoyed by other official currencies issued by central banks. “

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