Analysis of Cryptocurrency and Human Development in Cameroon

This report examines the potential human development benefits of cryptocurrency in Cameroon, a developing African nation. It explores the current state of cryptocurrency, including Bitcoin, within Cameroon, its legal status, and the emergence of new businesses in the sector. The research identifies the problem through online questionnaires and interviews with innovators and entrepreneurs, analyzing internal factors like supply and demand, and external factors like market trends and legislation. The report reviews literature on cryptocurrency volatility and market dynamics, highlighting the rapid growth and fluctuations in value. It also discusses the role of blockchain technology, the benefits of decentralized transactions, and the regulatory landscape. The study considers the impact of cryptocurrency on Cameroon's economy and human development, including transaction costs, market popularity, and legislative restrictions. The report includes an analysis of variables such as the crypto market capitalisation, volatility, and trading volume, as well as the potential for both short-term and long-term effects on the price of cryptocurrencies. It also refers to the existing financial regulations within the CEMAC region and the implications for cryptocurrency adoption and usage.

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CRYPTOCURRENCY IN CAMEROON
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CRYPTOCURRENCY IN CAMEROON
Introduction
One fact remains constant: in our fast moving world, far faster than any period in human
history, with the rapidly evolving technological advancements from the fourth industrial revolution
to the cost economy. Various innovations are coming into the application; the robots and the man-
made intelligence have surged into use (Delmolino et al. 2016). Newer technologies have come into
use in all the sectors. At the forefront are the techniques regarding the financial transmissions across
the internet without necessarily involving any financial institutions? Therefore this paper reports on
one of the currents technology known as the blockchain, an innovation created as one of the major
pillars of Bitcoin, the cryptocurrency which surged into the global financial domain in the year 2008
(King 2013). While the people may regard most of the current technological advancements like the
robotics and other artificial in intelligence to be having some darker aspects, the new technology of
blockchain is fundamentally perceived to be a platform for various positive transformations. The one
that causes a disruption to the global economy and attends to most of the economic and political
issues that countries both developed and underdeveloped are facing in the contemporary time (Park
et al. 2015). Otherwise, the very claims may not seem new; however, blockchain technology is
luring the attention of the various actors from state governments and the global financiers to the
private entities and the project capitalists. This paper will base on the major problem about the
probable human development benefits of cryptocurrency in one of the developing countries in
African continent- Cameroon (Gandal and Halaburda 2014). In the appendices, the questionnaire,
working papers I and II for this particular research are added to show how the research was probably
conducted. Also the working papers I and II are attached in the appendix ascertain the format of the
research.

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1.Problem Identification
The primary concern in this research is to examine the aspects of the human development's
benefits of cryptocurrency in Cameroon. The identification of the problem was conducted by using a
primary source of data collected by the use of online questionnaires and online interviews (Hayes
2017). The targeted groups of people will be 60 innovators (that is the group of people already
transacting Cryptocurrencies) and 40 Techno- entrepreneurs. The keywords like, bitcoin, digital
currency, and cryptocurrency and finally, the virtual currency with sustainability in the various
online databases was employed. In fact, as per the research, all the databases consulted, the majority
of they were published very currently between the inception of the technology and the year 2017
(Hileman and Rauchs 2017). This may be because the cryptocurrency is becoming more and more
popular within the international system. The Republic of Cameroon has a little bitcoin group
contrasted with its more settled African partners in Kenya, South Africa, and Nigeria (Fry and
Cheah 2016). In this article, you will be acquainted with the condition of bitcoin in Cameroon
including its legal status and the new businesses that are empowering Cameroonians plausibility to
put resources into bitcoin (Ametrano 2016).
2.Problem Definition
Many people are well conversant with the use of digital currencies, ever since the IBM
invented their 3651 controllers and 3663 checkout point in the year 1973 (Scott 2016). The
functions, importance and the obligations of the digital currencies have tripled over the years,
widening the boundaries of mobility, security and convenience (Iwamura et al. 2014). Technologies
like the use of credit cards, automated teller machines, pin, countless innovation and the point of sale
chip, and probably the increase of the e-commerce and other related technologies have actually
enhanced the application of the digital currency to act as an alternative to the old ways of

Cryptocurrency in Cameroon 4
transactions using cash and cheques (Duffield et al. 2014). Right now, bitcoin and other advanced
monetary forms have no legitimate status in Cameroon. The national bank of the six-country money
related association, CEMAC, has not yet issued a particular direction on the utilisation of bitcoin
inside its boundaries (Iwamura et al. 2014).
However, in the contemporary years, most of the people have made a shift and diverted their
attention toward the type of a new currency known as the cryptocurrency (Andolfatto 2015). This
new type of money is seen to be seeking for the digital medium to make the transaction more secure,
anonymous and outside the influence of any authority. In Cameroon, since, since its inception in the
year 2008, its use and volume has tremendously grown (Abraham et al. 2016). Though still under
some development and adjustment since 1983, cryptocurrency has been regarded as the digitally
coded scripts that yearn to replicate copy the government-backed currencies we utilise currently
(Raymaekers 2015). However, while all the transactions concerning the government-backed monies
are tracked by some of the institutions like the clearinghouse or banks, this type of the new currency
is monitored by a technology known as the blockchain (Litke and Stewart 2014). This is probably, a
publically seen, digital ledger operated by the individuals or the syndicates who are extraordinarily
useful and use the reliable and efficient networks of the computers to do and solve some dynamic
and complex math sequences in the exchange of some transaction fees, commonly known to be the
cryptocurrency (Harwick 2016). Now, this decentralised form or type of transaction has got many
benefits over the centralised, backed governments’ currencies.
First of all, it enables quicker and cheaper transactions, since it only involves or allows the
transactions to be done between two parties rather than through a middle body or an intermediary
(Vigna and Casey 2015). Secondly, as compared to the old and expensive methods of raising monies
via the initial public offering, cryptocurrency provides the platform for raising funding more
transparently or straightforwardly. This has stimulated a tremendous growth in the primary coin

Cryptocurrency in Cameroon 5
offering market (Herbert and Litchfield 2015). And thirdly, the fictitious nature of the
cryptocurrency that is to say the account transacting are probably known, but the persons owning the
accounts are known neither are they in the government, really shows that cryptocurrency has gained
a large transaction among the persons concerned about confidentiality and privacy (Li and Wang
2017). Regarding all the benefits mentioned, the national bank of CEMAC created a legitimate
system for electronic cash in 2001. In its system titled 'Regulation No. 01/11-CEMAC/UMAC/CM –
On the Use of Electronic Money', the controller traces how electronic cash can be utilised to bank
the under banked populaces in Cameroon and the entire region (Duffield and Hagan 2014). But,
there is no mention of bitcoin or other decentralised digital forms of money in the system.
Cameroonians can hence purchase, hold and utilise bitcoin at any time they see fit, at any rate, the
point that a particular direction on bitcoin will be issued (Evans et al. 2014). While that is uplifting
news for bitcoin dealers and financial specialists, it implies that bitcoin and blockchain new
companies don't fall under regulatory oversight, which can be an issue for buyers as they get no
insurance yet in addition for the startups themselves who are working in a regulatory "a dead zone"
without knowing whether a regulation could come and step them bankrupt as it has been the
situation in Namibia, which as of late prohibited bitcoin use in trade (Kazan et al. 2015).
As a platform regarded for the financial transactions, Bitcoin demands a digital ledger to put
down all the transactions happening among the users of the cryptocurrency and store them as clean
records (Narayanan et al. 2016). The blockchain is probably the technology that provides such a
ledger. And the techniques used in designing this ledger is what resulted in what we now call the
blockchain technology (Halaburda et al. 2014). This Bitcoin software was created or invented by
Nakamoto and released into the internet as open source software, which has enhanced the diffusion
of transactions on the global scale since its inception (Hughes and Middlebrook 2015). In the very
beginning or the early years of this project, it was operated in fringes of states as a few officials were
willing to incorporate it as a legal form of transaction or payment. The dark web instead placed

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things in a different perspective (Abramaowicz 2016). It gave forth an anonymous form of
transaction that could not leverage the tracking of buyers and sellers. The now disgraced Silk Road
web platform, popularly known to be an online black market used Bitcoin, while the technology
enabled the cryptocurrency conversion into U.S dollars (Brenig et al. 2015).
3.Identification Variables of Interest
In this research regarding the cryptocurrency in Cameroon, there is a realization of almost
three crypto price variables, constituted into internal and external factors. Now, supply and demand
are the significant internal variables that influence the market price of the currency (Koning 2016).
On the other hand, popularity, legislation or adoption and some of the macro-finance like the stock
market, interest rate, are probably the external variables in this context (Farell 2015). The figure
below highlights all the variables.
Internal factors
Supply Demand
External factors
Cryptomarket macro-finance politics
Transaction Cost Popularity Stock markets Legislations
Hash rates Market trend Exchange rates Restrictions or ban
Reward processes Speculations Price of the Gold Others
Coins in circulation Interest rates
Rule changes Others
Cryptocurrency price

Cryptocurrency in Cameroon 7
In this regard, I assessed the long term and the short term factors that have the impact on the
prices of the cryptocurrency since its inception to date using the models such as the ARDL on the
collection of data in a weekly basis (Darlington III 2014). Now, I created a crypto 40 index by
sampling the very top 40 crypto coins that have the relative contribution to the Cameroonian market
capitalisation weights. Therefore, I realised some crypto market aspects, for instance, the overall
market capitalisation, volatility and the trading volume in the very market (Sompolinsky et al. 2016).
I then use these aspects as the explaining variables for the cryptocurrency price shifts together with
the popularity and the control variables, for example, the stock market movements, gold values and
the interest’s rates. For this particular study, there is a provision of the critical long-run role of the
popularity of the crypto coins in the definition or the determination of their prices (Minor et al.
2015). I also realised a feeble form of adverse impact running from stock markets to the crypto-coin
market, and more particularly Bitcoin.
Literature Review
From the year 2006, based on the interviews I had with the 60 innovators and 40
entrepreneurs of cryptocurrencies in Cameroon, the market has realised unique aspects of interests
(Dvorak et al. 2015). The technology of Bitcoin, the world's most significant digital currency, has
increased more than fifteen hundred percent since the beginning of the year 2017 but, the market is
essentially more dynamic than the public lexicon might say. Whereas a lot of studies have been put
forward assessing and evaluating the future of the cryptocurrency and its aspect of volatility, there
have been a few aspects exploring the broader bases of the crypto-coin market and how it has been
evolving (Gladden 2015). At the very beginning of the year 2018, I realised that Bitcoin was trading
at sixteen thousand US dollars and its price was one thousand dollars, raising alarms from some
analysts and the widespread financial values that it is a bubble. This particular currency has been
realised to be extremely volatile despite the fact that it was ever-peaking in performance recently,

Cryptocurrency in Cameroon 8
increasing by thousands of dollars in price and value and then only to decline even by more value
the next day (Barkatullah and Hanke 2015).
According to Katsiampa (2017), he gives the estimations about the volatility of the Bitcoin
through comparing the GARCH models and finds out that the AR-CGARCH models provide the
ideal fit (Cocco et al. 2017). According to him, the market is highly speculative; other scholars study
Bitcoin values using the optimal-GARCH model and report that the volatility of the cryptocurrency
has declining trend in comparison to the pre and post-2015 data. Even further, they still recognise
some critical asymmetries in the Bitcoin market where the values and prices are mostly being
determined by adverse shocks than positive shocks (Ronca et al. 2017). Likewise, according to
Dyhrberg (2016) the asymmetric GARCH methodology to find out the hedging capacity of the
Bitcoin and in his investigation he realizes that it can be applied or utilized as hedging equipment
against the stocks of the Financial Stock Exchange Index and probably against the American dollar
in a short-term period (Kim et al. 2016). On the contrary, scholars like Alessandretti (2017)
evaluates the behaviour of the entire market of the Bitcoin in a four year period and realizes that the
cryptocurrencies have the tendency of appearing and disappearing on a continuous basis and their
market capitalization is raising extraordinarily. Several statistical data analyses of the market are
regarded as being stable for some years (Pacy 2014). More specifically, the market share turnover
and the distribution of the crypto coins remain a little stable.
In other circumstances there has been quite some agreement concerning the cryptocurrencies,
stating that it will not only influence the trading practices of various states and corporate
organizations, but they will have a probable impact of the dynamics of the international relations
(Buterin 2014). A lot of persons are still skeptical, and they do not want to accommodate the fact
that one time the idea of cryptocurrencies will revolutionize on how we transact and do businesses.
People still can’t figure out how the entire technology of the blockchain and other related annexes
will function or operate. In addition, the technological advancements in the entire globe are creating

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new and digital tools that companies can use to better relate to their clients' overtime (Choo 2015).
The increasing waves and shift from the traditional medium to the digital platforms have also
triggered some infinite supply of information from the social media, mobile devices, and online
retail platforms. Therefore, because of the various technological transformations in different areas
like collecting, storing, and sharing data, large chunks of data shared within the corporate
organizations in every areas and state for minimal costs (Gjermundrød and Dionysiou 2014). The
spreading accessibility has also resulted in concerns and issues over data privacy and the particular
online transactions. Since the very transaction activities done online leaves the digital traces,
therefore, people are opting for more techniques and ways to utilize the internet and carry out the
online businesses (Hayes 2016). The Bitcoin cryptocurrencies, particularly in Cameroon, could be
introduced or legalized to address the aspects regarding privacy.
However, crypto coins' devolvement or decentralization, anonymity or the pseudonymous
nature of the transactions and the irreversibility nature of the payments have lots of benefits to the
populace using it in Cameroon (Chohan 2018). According to this research, the preempted features
are also very essential in the attraction of the illegal activities like the cybercrimes and the erosion of
the cyberethics and laws. These may be things like money laundering, weapon procurements,
smuggling and even drug peddling. Otherwise, because of these issues, the governments are on the
extreme alert to put critical regulatory policies and other governmental agencies (Litke and Stewart
2014). The government agencies like the Financial Crime Enforcement Network, the SEC and even
the FBI and other departments of security have been put in place to take the full watch on this
particular aspect.
Methodology

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This research was done based on two approaches. The first approach was quantitative
analysis. Various libraries and internet sources were visited to find out the approximate numbers of
people using various forms of cryptocurrencies to earn themselves a living. In the same vein, the
number of people who are affected negatively either directly or indirectly was determined. Although
a lot of focus was placed on Cameroon, other countries like Nigeria were also sampled. The
qualitative approach was somewhat a little confusing to accomplish, but it was accomplished all the
same. The difficulty arose due to the fact that the participants had to be contacted in person to
narrate their experiences to the researchers.
The data were analyzed with a combination of several tools of data analysis. Most of the
quantitative data were presented in charts (bar), as we will see later in the report. In addition,
regression analysis was used quantify non-figurative data such as some of that which was collected
using questionnaires. The findings and results were classified depending on groups of data. That is,
related information was grouped together for ease of analysis.
Data collection process
Most of the data were collected by the use of questionnaires. This was because the research
required that a large sample of the population be assessed. The questionnaires were distributed
through various channels like agents, who picked the leaflets from post offices in their areas of the
situation, before distributing it to the target populations. However, respondents who were close by
were contacted for face-to-face interviews to save resources. Where affordable, respondents who
were too far to be reached in person for interviews or questionnaires were contacted by telephone
and interviewed through the same. The phone interviews were recorded on tape for reference
purposes.
Sources of data

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The primary sources of data were the proprietors of cryptocurrency organizations in
Cameroon. However, we took care to contact only those owners whose operations were legal and
certified to avoid rubbing shoulders with authorities. The primary sources then referred us to other
secondary sources whom they had introduced into the business. Also, as I had earlier pointed out,
some of the data was retrieved from libraries and trusted internet sources, some of which are
captured in the references section of this report. The government agency that is charged with
authenticating and licensing cryptocurrency businesses was also contacted to give first-hand
information on what they knew about the business; its advantages, shortcomings, challenges, and
many more.
Research philosophy
The research was conducted based on a positivist philosophy. This was done so because of
the widespread reputation of cryptocurrencies. I thought it better to use this philosophy so I would
not have to pitch the disadvantages of cryptocurrencies directly with the advantages as this would
have proved a little more difficult. So I decided to exhaust all the positive aspects of the research
topic and find out the negative aspect later. For that matter, therefore, most of the questions in the
questionnaires sought to find out the positive side of every aspect they represented.
Cryptocurrency in Cameroon
4.Quantification of the Variables
The literature behind the economics of the Bitcoins or the crypt currencies in Cameroon is
very scant because the topic or the subject is very modern and has not gained more focus in the
research domains (Lingappa 2015). Otherwise, this paper will contribute to this context of the
subject are by merely assessing factors that affect the prices of the most popular five
cryptocurrencies over the past seven years, that is to say from the year 2010 to the year 2018 with

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weekly based data (Sat et al. 2016). Therefore, for this particular assessment, let’s determine our
econometric set up as below.
Where m is the ideal or the optimal lag length which is defined by the data criteria, in this
context, Pc,t is the endogenous variable, and it represents the price of the crypto-coin c at the
traditional logarithm state at month t. The whole lot of other variables is considered to be exogenous
(King 2013). The Ω shows three cryptomarket variables of MARP and MARV and MARS for
instance that are crypto 40 index price, its trading capacity or volume and its volatility at week t and
ATR is considered to be the popularity or the attractiveness of the currency c. In addition, we also
account k define of control variables of Zi like the stock market by the SP500 index, exchange rates
in EURO/USD, interests rates and the world gold price (Graydon 2014).
Information for digital forms of money is accumulated from BitInfoCharts site; the cost of
SP500 list is recovered from Yahoo Finance, and the macroeconomic information is acquired from
World Bank (Chohan 2017). The engaging quality of digital money is proxy by its Google look
recurrence; we get related information from Google seek trends. We quickly abridge financial
matters of digital money advertised by laying out key measurements. Coin Dance 6 frequently
declares breakthrough and authentic report insights of digital currency markets. Concurring their
latest report, 34.4% of total market share is for the Bitcoin, while 19.23%, 10.74%, and 1.97% offers
are inferable from Ethereum, Ripple, and Litecoin individually (Simonite 2013). Also, their report
demonstrates that 96.57% of digital money advertise involvers are guys, while just 3.43% are
females. The age conveyance alludes to the capacity of the digital money market to pull in the
extensive variety of individuals from remarkably youthful to exceptionally old. The report gives
insights for just 18+ ages where 8.36% of the market participants are matured 18-24, while 45.71%