How using Bitcoin to pay gig-workers in Africa is a no-brainer
Almost two years ago as co-founder of Mobbr we were a finalist in the startup challenge at the annual Global Bitcoin Conference. In our pitch, we argued that the emergence of online labor was vital for bitcoin to become a successful currency, as for people to start spending bitcoins they need to earn them first. Around the same time, I published a blog called ‘Why Bitcoin Is Good For Crowdsourcing’, in which I explained that the existing financial regulatory framework and traditional payment infrastructure cannot handle the complexity of international platform-based collaboration, as these often involve mass, international micro-payments. Now two years later, I’m proving my point with Tunga.
As many of the workers Tunga aims to work with do not per se come from an elitist environment, facilitating payments to them is not always the easiest of tasks. Many do not have passports, as a result of which many do not have a bank account as well. And even if they have, sending dollars or euros to a bank account in Uganda — or sending it by Western Union — and converting it to local currency is an extremely expensive and time-consuming endeavor anyway.
Enter bitcoin. Bitcoin seems to have discovered the huge remittance market, where Africans living abroad send money home to support their families. A service like Bitpesa is capitalizing on this, offering a conversion service from bitcoin to local mobile money wallets in Kenya, Uganda, Tanzania and Nigeria at around a 3% conversion fee. This makes Bitpesa substantially cheaper than its traditional alternatives. Plus the whole process of sending bitcoins to someone and converting them into a local mobile money wallet is extremely simple and takes minutes to hours instead of days to weeks. In other words, for payments from Europe or US to Africa, bitcoin is a no-brainer.
This is why during our pilots we have solely used bitcoin to pay the participating coders for their work. Whereas beforehand there was some hesitation on our side whether using bitcoin would scare off coders and/or clients, neither has turned out to be the case. The current version of the Tunga platform — which is a very basic prototype — for now only facilitates bitcoin. And as we are working to expand payment options, bitcoin will remain by far the most favorable option for all users in terms of time and money. Not because it is trendy or hip, not because we are anarchists or evangelists, just because it is by far the best solution for our users. Just like I argued two years ago. Nice!
