Cryptocurrencies and Africa, a better love story than Twilight. When Bitcoin was launched a decade ago, very few could have foreseen the impact that it would have on the future of Africa. Ten years later, Bitcoin is changing the continent, ridding it of some challenges that have plagued its people for several decades.
For a long time, Africa has been at the mercy of a few elite entities who have had unchecked power, in the political arena, in finance, manufacturing and plenty more. And while Bitcoin will take longer to change the political space, it’s revolutionizing the finance industry already.
For Africa, the challenge was never the lack of resources. The biggest challenge has been that these resources have been in the hands of a few greedy people who have skewed the system to their favor. Take the remittance industry for instance. Africa continues to receive hundreds of billions of dollars every year in remittances from across the globe.
And yet, despite the growing significance and impact on the economy, payment processors still find a way to charge exorbitant fees to the people. Africa still has the highest remittance costs in the world. This is ironic, considering that banks in the developed countries, where the average wages are higher, charge lower fees.
This is just the tip of the iceberg. However, it’s these challenges that make Africa the ideal place for Bitcoin to revolutionize. Lorien Gamaroff, the CEO and co-founder of Centbee wallet, is one of the people leading the charge, seeking to use Bitcoin to give Africans the chance to send and receive money in a frictionless manner.
In his recent chat with CoinGeek’s Charles Miller, Gamaroff revealed that having been born in Zimbabwe, he understands just how much turmoil a mismanaged financial system can cause. The economic troubles in Zimbabwe were a big motivator in his decision to find a better alternative for the people of Africa.
“In Africa, it’s tangible. We have currencies that are failing, we have high costs of moving money, financial systems that are unavailable. I don’t know how anyone cannot see the opportunity there to help a huge number of people with Bitcoin.”
For Gamaroff, Bitcoin is most effective when it powers payments in a fast and cheap way, without the users even having to understand all the complexities behind the scenes. And his company’s products reflect this, being designed to incorporate even those who are not conversant with Bitcoin.
One of Centbee’s products allows its users to accept payments in Bitcoin from other people who get to send it in cash or using credit cards. As a Centbee user, you get to generate a code that you then send to the invoicee. The recipient then walks into any one of the thousands of retail outlets in South Africa that Centbee has partnered with, pays the indicated amount using a card or through fiat and you receive the money instantly. The invoicee doesn’t have to know that Bitcoin was used. Nevertheless, they get to enjoy the benefits that the real Bitcoin offers, including instant payments as opposed to the delays in the banking system as well as very low fees.
Bitcoin has been adopted in Europe, Asia and North America majorly, with these regions accounting for an overwhelming majority of the trading volume. While Africa has lagged behind, Gamaroff believes that the continent is still in the best position. For Africa, it’s not about speculation, it’s about utility. Two decades from now, Western countries will be studying Africa to learn how Bitcoin best works to power the new financial system, Gamaroff believes.
While the opportunities for Bitcoin to change lives for hundreds of millions of Africans are immense, Africa still has a few hurdles it must solve to enable the revolution. The greatest of them is regulations, with a majority of African countries having no established policies to govern the use of Bitcoin. African countries can take their cue from countries like Malta which, despite being quite small, has become a blockchain hub thanks to its well laid out crypto regulations.