Cryptocurrency trading volumes decline by 10.7%

The global cryptocurrency market capitalization has taken a hit, dropping by 5.2% to $1.8 trillion in the last 24 hours, while trading volumes have declined by 10.7% to $85.2 billion. This decline comes as the conflict between Russia and Ukraine intensifies, leading to a ripple effect across the cryptocurrency world. To shed light on this situation, Gituku Ngene, Senior Regional Advisor at Mercy Corps, joined CNBC Africa for an in-depth discussion. Ngene expressed that the cryptocurrency market is inherently volatile due to its unique nature compared to traditional fiat currencies. He emphasized that this volatility is likely to persist in the coming months and years. Despite the current downturn, Ngene highlighted the use cases of cryptocurrencies, particularly stablecoins, in markets like Africa. He pointed out the significance of stablecoins in areas such as remittances, which play a crucial role in African economies. The Russia-Ukraine conflict has had a substantial impact on the crypto world, with sanctions affecting traditional financial systems like SWIFT. Ngene explained that cryptocurrencies are emerging as a viable alternative to fill the gaps left by these sanctions. This shift could potentially strengthen trust in cryptocurrencies for global transactions and signal a new wave of adoption, especially in regions facing financial challenges. Stablecoins, such as Bitcoin, have also faced fluctuations amid the global turmoil. Ngene noted that stablecoins, being pegged to fiat currencies, provide a level of stability compared to mainstream cryptocurrencies like Bitcoin and Ethereum. This stability opens up opportunities for cost-efficient cross-border transactions, particularly in regions heavily reliant on remittances. Ngene cautioned against predicting the precise outcomes of geopolitical events on crypto markets, citing the unpredictable nature of the industry. He underscored the importance of observing how stablecoins could drive financial inclusion and streamline remittance processes in underserved regions. Ukraine's decision to accept cryptocurrency donations amid its financial challenges due to the conflict drew attention as a strategic move. Ngene commended this decision, highlighting its significance for humanitarian organizations like Mercy Corps. He emphasized the potential of cryptocurrencies and blockchain technology to bridge financial gaps in conflict zones where traditional infrastructure is lacking. In conclusion, Ngene emphasized the need to explore diverse use cases for cryptocurrencies beyond speculative trading. He stressed that cryptocurrencies could play a pivotal role in humanitarian efforts, remittances, and reducing transaction costs for digital workers. The evolving landscape of cryptocurrency adoption, especially in crisis scenarios like the Russia-Ukraine conflict, underscores the transformative potential of digital assets in reshaping traditional financial systems.