Yellow Card, a cryptocurrency exchange founded by Chris Maurice and Justin Poiroux in 2019, has emerged as the largest centralized exchange in Africa. With $1.75 billion in transactions facilitated so far. The platform offers a similar experience to Block’s Cash App. Allowing users to purchase cryptocurrencies using fiat currencies and send them across borders. This is very different from other centralized exchanges where customers store their tokens for extended periods of time. The average Yellow Card customer keeps their money on the platform for less than five minutes.
To explain, Yellow Card’s platform lets users send money to 16 countries in Africa. Additionally, it streamlines the process of converting crypto back to local currencies. With approximately 220 employees, the platform currently has 1.4 million users across the continent, facilitating around $5 million in transactions on a good day and up to $1 million on a slow day.
Yellow Card has a valuation of $200 million and has raised $57 million in funding from investors such as Jack Dorsey’s Block and Valar Ventures, co-founded by Peter Thiel. The company aims to expand its greatly appreciated services to the rest of the continent and become a billion-dollar company.
One of the reasons behind Yellow Card’s success could be the problems with Africa’s banking system. For instance, roughly 80% of cross-border payments originating from African banks are processed offshore. Those are mostly in the US or Europe, which translates to higher costs and processing times that can sometimes take weeks.
According to Ray Youssef, CEO of Paxful, “The entire banking system in Africa is completely and utterly broken. Even amongst the mobile money providers, the telcos.” This creates a tremendous opportunity for crypto to fill in the gap presented by the traditional banking system. Crypto payments facilitate effective cross-border transactions that take place in real-time. In conclusion, making it a game-changer for the continent.
