Blockchain and Cryptocurrency: Are they Practical in Africa with Dickson Nsofor
As the CEO and Founder of Korapay, a cross-border payments and remittance platform utilizing technology (+Blockchain) tomake payments within, to and from Africa seamless. Dickson shared some of his Blockchain knowledge with our twitter community
Every two weeks, we invite some of our Ingressive Community member from all over the world to participate in a Tweetchat session. It’s an opportunity for tech founders, tech enthusiasts, developers, and designers in our community to gain in-depth insights on tech trends and how tos.
This week, we were honored to host Dickson Nsofor, CEO and founder of Korapay — a cross-border payments and remittance platform utilizing technology (+Blockchain) tomake payments within, to and from Africa seamless.
The tweetchat was insightful and as well as exciting!
Dickson here and I am excited to tweetchat on Blockchain and Cryptocurrency’s practicality in Africa
I’d like to thank the Ingressive Team for putting together this chat. The Ingressive Team continues to achieve its aim to open up resources and opportunities for tech communities across the continent.
Africa is dare to my heart and it is my passion to always share my 2cents on whatever benefits or would help the continent.Thanks again for having me.
Firstly,
Bitcoin is not Blockchain!
In practical terms, let’s call Blockchain = Electricity and lets say Bitcoin = Light Bulb.
Most people think of Electricity as Light, so it’s understandable why people think Bitcoin is Blockchain.
In recent times, Bitcoin and other crypto’s have garnered substantial attention across Africa. No asset can do 1000% returns and not get the attention of even an ordinary cab driver.
A lot of people are interested in this wave of new technology as it is no longer a buzzword in Africa, but an engine powering significant gains and change across the continent.
The movement of blockchain has transcended the usual cryptocurrency trade and is now being considered by various sector players for application across the continent.
Interestingly, while all cryptocurrencies run on blockchains, not all blockchains have cryptocurrencies.
Remember the Light bulb and Electricity analogy above?
All Light bulbs run on a form of electricity but Electricity must not light up a bulb to be Electricity. We can use Electricity for machinery tools and all other sort of application
So we can simply define Cryptocurrencies as, a digital asset or digital form of money, leveraging blockchain technology that only exists online. Cryptocurrencies use cryptography to verify and secure transactions, hence their name.
Its major characteristic is its ability to transcend borders without a central control*** This is the juice of it all
The difference between crypto and traditional financial models is in the decentralized nature of cryptocurrencies. Means that when you spend a cryptocurrency, the approval of the transaction is not from a central authority
But rather from a Peer-to-Peer network of computers, coming to a consensus that your transaction is legitimate on a blockchain.
There are many great Africa startups doing great work with Cryptocurrencies but in my opinion, the only market that is practical on the continent for optimization through Crypto is CROSS-BORDER PAYMENTS.
We can see a lot of amazing companies in the payment space using crypto like, Bitpesa and Suremit just to mention a few.
Crypto permits Fintechs to provide a cheaper and faster service to its users. None of these great companies would be able to serve their customers amazingly without the underlying technology called Blockchain.
There are many ways to define Blockchains but I like to call it the Database of Truth! with 4 pillars:
1-Immutable
2-Time stamped
3-Verifiable
4-Transparent
This is priceless, and revolutionary as it signifies the ability for Value to be transferred over the internet!
Now, how does this relates to Africa??? is there any practical application in Africa?
I have seen all sort of projects leveraging blockchain, from Supplychain and Agro-tech down to Instant messaging and gaming solutions.
But for Africa! Any Blockchain solution must be able to factor in 3 major challenges:
1-Infrastructural deficit
2-Poor Internet connectivity
3-Low access to devices (MobilePhones)
Africa’s challenges are unique and all solutions must be tailored to suite the continent. It’s not a one size fits all continent, and even within the continent, each country is unique as well.
In my 2 cents, I see just 3 practical applications of Blockchain in Africa:
1- Identity (Issuance and Management)
2-Land Registry (Government Database)
3- Payments (Inter-bank Settlements)
IDENTITY, is the crux of all of Africa’s problems. Identity is the bedrock of social services which is the blood line of a country. There is such a great opportunity in issuing and managing Identity via Blockchain across Africa.
No Identity means, no way to account for people, no way to build credit. Loans and trust becomes the hardest thing hereby leaving many people in the poverty circle. ID is key
LAND REGISTRY- shout out to my brothers and sisters who once bought a land last year but this year the land belongs to the village chief!
hahaha
Properties and asset registration is such a volatile market in Africa.
Mostly because of corruption. The chief tells the ministry that he owns your thing and the ministry burns the paper file (or maybe the Snake swallows the papers of your house in their custody)
If any government/country ever adopts blockchain for asset registration, that would be the greatest thing it can do to foster economic growth. Y’all should read “ The Mystery of Capital” by Hernado De soto.
PAYMENTS- I so believe in this application of blockchain to Africa that I founded Korapay. You can’t have companies charging African’s 8–10% for remittance and not do anything about it.
There is so much room for Blockchain powered crossborder settlement network and that the future we see. Where you can send money to Ghana from Nigeria like you send a WhatsApp message!
With this 2 cents of mine, I believe Blockchain is over estimated in the short run but highly underestimated in the long run. Africa is the only place with the most room for growth.
Thanks and was my pleasure sharing
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