How The Psychology Of Money Impacts Bitcoin Users

Forbes

10-04-2025

Young colleagues checking their e-banking account
getty
In the last year, I've interacted with bitcoin users in Africa to understand what it means to them. Through 10 physical events and online channels, including spaces and podcasts, I've seen the vast difference in meaning bitcoin evokes for different people. Three distinct perspectives regarding scarcity, trust, and risk define how people interact with Bitcoin in Africa.
Africa bears a paradox of abundance and scarcity. The abundance lies in people-first culture, history, and vibrance in multiple facets of life. Scarcity lies in the distribution of economic resources thanks to regulatory environments that tend to stifle businesses. This is felt through youth unemployment, at 30% in some regions or as high as 67% in Kenya, as reported in the African Leadership Magazine.
One question that tends to come up frequently is, 'How can I make money in Bitcoin?'
The answer is simple: look out for Bitcoin companies hiring in communications, accounting, education, or business development, among other roles. Bitcoin Dada, for instance, has successfully trained eight cohorts of students, and some have secured roles in the global Bitcoin ecosystem. Alternatively, consider other jobs that can pay part of the earnings in Bitcoin.
Some people use Bitcoin, not because they understand it, but because they want a frictionless method of payment for gig work. Others engage in the peer-to-peer markets, trading Bitcoin to profit from arbitrage opportunities in the ecosystem.
Money provokes beliefs, conversations, and experiences about trust and distrust. This plays out socially and nationally in considering how financial institutions deliver on trust to their customers. In an age of cyber fraud, where someone can find money missing from their bank or mobile wallet, trust is a big deal.
Cybercrime cost Kenya $83 million (KES 10 billion) in 2023 and could cost African countries up to 10% of their GDP, according to Africa News. Traditional financial systems have come a long way in offering convenience, privacy and security to their clients. One limitation lies in their centralization; since the larger the honeypot is, the more attractive it becomes to clients and cons. Clients search for a haven while cons seek to cash out on the efforts of others.
You may ask, 'Is my money safe in Bitcoin?'
This creates a trust bias for Bitcoin: some people adopt it out of distrust in centralized financial systems, while others distrust it since it's yet to be integrated with existing financial systems. Bitcoin users find value in its secure infrastructure and 24/7 liquidity to serve the purposes of remittance, savings, and speculation.
Your money is safe when it's under your control and in your privacy. Which financial tools offer you control, value above inflation, and privacy?
Risk is inevitable. We see it in currencies losing their value over time. The problem with this is that it's not an abstract number but a direct impact on people's lives and businesses. Salaries don't keep up with inflation, and businesses have limits on pricing their products and services to be sustainable.
External debt looms with risks of higher taxation, which adds to the strain of unemployment on the continent. As cited in the Mo Ibrahim Foundation News as of 2023, Africa owes about $1.8 trillion in public and external debt, whose repayments crowd out enterprise and development. Bitcoin users find it attractive in jurisdictions that don't tax it because it offers a measure of relief from taxation. On the other hand, price volatility in Bitcoin deters people who view it as a gamble.
'What if Bitcoin goes to zero?'
The probability of Bitcoin going to zero gets smaller with each day of its growth in adoption. In 16 years, it's recognized as a store of value globally, has relevance in supporting circular economies like Bitcoin Ekasi and is still used for cross-border payments around the world.
The psychology of money affects Bitcoin users in a manner that's worth observing over time. Bitcoin users tend to embrace risk, take advantage of the global liquidity, and use it as an alternative means to create financial freedom. People who are yet to embrace Bitcoin as a concept or tool for their use hesitate out of risk aversion and avoid the learning curve that comes with using Bitcoin for different purposes.
For a 16-year-old asset class, Bitcoin will go through more scrutiny, tests, and gradual wins as adoption grows in different stages.