I’ve lived in South Africa all my life, I know no other way of life, and I’d say in many ways, it’s pretty similar to the rest of the world, and in other ways, it’s completely different. I am fortunate enough to have many modern comforts like education, shelter and access to the internet. With that alone, I am probably firmly in the 1% of wealth when we look across the continent.
Now I am no millionaire; I am a working-class guy who, by first-world standards, makes less than minimum wage. Having travelled across the country and to other countries on the continent, you don’t have to look far to see abject poverty; that would make me feel like a billionaire, never mind a millionaire.
African’s are currency agnostic
I’ve got friends from different countries across Africa, Nigeria, Egypt, Zimbabwe, Uganda all over, and one thing I can tell you is that we’re not tied to any currency. Yes, we use the currency mandated by the region we’re stuck in but it’s never stopped us from trading other currencies side by side.
The only reason African’s insist on cash is because of its liquidity, the fact that it is accepted everywhere we need it to be accepted, the stores. However, we’ve proven time and time again that the medium of exchange does not matter.
In Southern Africa, it’s straightforward to transact in our local currency, the Rand, even when going across borders to neighbouring countries. Moving further up the continent, if you have USD, it’s as if it’s a native currency; people have zero issues accepting it and, in some cases, will even prefer or insist on being paid in the stronger currency.
These are NOT people following the forex market and economy; these are simply rational economic actors looking for a medium of exchange that holds its value longer per unit it represents.
Across the continent, things like airtime, data bundles, SMS’s, shopping vouchers, store credit, and anything that can be somewhat pegged to the unit of account of that country is freely exchanged in peer to peer markets.
For Bitcoin to be embraced, it simply needs to become a more liquid currency interoperable with merchants and other forms of accepted payment, as I’ve mentioned above.
Once these rails are laid, I see no reason why migrating to a Bitcoin standard won’t be encouraged as people want to take advantage of its deflationary properties.
Limitations of physical currency.
Growing up on the continent, Africans are taught NEVER to carry more cash than they can afford to lose. Like many repeat regarding investing
Invest what you can afford to lose;
we know not to keep more cash on us than we’re willing to lose, as there’s a pretty high chance of it being forcibly removed from your possession.
While physical cash provides the ease of transacting offline with low friction, it does present a considerable risk to those carrying cash. Having been the victim of a couple of pickpocket attempts during my commutes to work, I can tell you it takes only a moment to switch off and end up losing your money.
It provides an added layer of protection when stepping out of the house and having some cash on you to transact with for your daily purchases.
The other limitation of physical cash is that it gets worn down over time, as it keeps changing hands and not every person treats their cash carefully it can become damaged and eventually becomes a lost unit of account that is forced out of circulation through deterioration, a problem you would not have with Bitcoin. The velocity of a satoshi can move an infinite amount of times without being degraded.
African’s embrace technology.
Africa has always been slow to pick up innovation which in this regard is a good thing since we didn’t labour under large capital expenditure on telephone lines. When Smartphones become popular and continued to drop in price, so did cellular networks as the demand for data connections increased.
While landline internet and desktop internet has always been marginal, mobile internet has taken off on the continent. This was leapfrogging into a mobile-first culture has brought about a range of efficiencies on the continent. Improved communication improved trade and was highly reflationary. It removed many inefficiencies that came with costly ways to transact and limited people you could reach with legacy infrastructure.
The same way Africans have embraced mobile internet; I feel Bitcoin can use as a platform for adoption. The vast majority of the continent goes unbanked or underbanked.
Africa needs more low tech Bitcoin support.
I know this sounds contradictory to my point about embracing technology, you need to understand the infrastructure that provides us access to the internet is still sparse; in many parts of my country alone, you won’t get internet coverage, never mind the rest of the continent.
So yes, Bitcoin would be at a bit of a disadvantage as very few people would be able to generate even a paper wallet or verify that the paper wallet or hardware wallet had value on it.
Not only that, but we’re not exactly blessed with the most reliable electricity sources on the planet, with power cuts and blackouts commonplace.
I have heard of exploring mesh networks and projects like GoTenna that would allow you to access the lightning network via radio transmission. Something I think would be embraced on the continent where low tech solutions tend to thrive.
If Bitcoin transactions can be made via radio transmission, SMS, USSD or NFC, then I think it would be primed to explode across the continent. African’s don’t need DEFI and more complex ways of extracting a yield; what we need is for onboarding rails to be as low tech as possible to lower the barrier to entry.
If Bitcoin can work on a feature phone with a simple UX like a USSD menu with a trustless model or uncle Jim node model, trust me, our fiats would get dumped by anyone with a few pennies to save.
Don’t be concerned with African shitcoiners.
Like everywhere in the world, shitcoin armies are growing to try and siphon off gains from Bitcoin like a parasitic state entity taxes the proof of work of its citizens. These are either people with enough means to gamble away earnings or those trading their labour for anything better than their local currency.
In this regard, I look at it as the first movers would be freelance services and microtask sites willing to pay users in Bitcoin and later to have Bitcoin-based companies on the continent start to pay for labour in the currency.
While the first batch may not be Bitcoin’s easiest sell, the second batch indeed is; they’re simply looking for ways to earn something of value and are happy to provide proof of work for their reward. There’s an adage that African’s are lazy, but how about paying them in something that’s not a shitcoin or a failed currency, and you might bring some motivation back to the labour market.
There is no allegiance to any shitcoin here; it’s all about what puts money in my pocket and food on the table. As ease of use and new currency distribution models come online in the continent, the switch to Bitcoin will happen.
It will take time, but allow me to give you an analogy that will explain it. In South Africa, our currency note denomination is as follows
- R10 – Green
- R20 – Brown
- R50 – Red
- R100 – Blue
- R200 – Orange
Now when I was growing up, a child would be okay with receiving “green monies”, but as we got older and as new generations were born “, green monies” become less attractive.
They now insist on Red or Blue monies, not because they understand inflation but because they realise that the “green” gets them less stuff when you go to the store than the other colours.
African’s might not understand shitcoin complexity theatre now. Still, as Bitcoins monetary policy continues to prove superior, the unconscious mind will force them to gravitate to the superior store of value.
I am an African; I am not Africa.
I can’t speak for the whole of the continent; there are naturally subsets of people who benefit from the way things are right now, there are people who will fear change, there are people who are far past being helped, but that doesn’t mean the continent doesn’t need Bitcoin, it does.
I am not advocating for a currency coup d’état, but what I am saying is the best producers on the continent, and capital allocators deserve a better way to store their value.
Having a stable currency that is internationally recognised will make our labour more competitive, making our goods and services more valuable and allow us to tap into the resources we couldn’t access without the reliance on foreign debt.
Countries, companies, individuals and tribes within the continent can then embrace, can finally embrace the sovereign roots and decentralised nature that the fiat system robbed from them.
Remember, many African countries lines weren’t drawn by Africans but by Europeans who divided up their spoils. This put culturally different people into one place, and people with other languages, ideologies and goals were grouped naturally with conflicting interests, NOTHING gets done, which is one of the reasons I feel stagnated progress in many African countries along with the corruption of anyone who’s close to the money trough.
Having money with no central issuer will allow these factions to build up capital to be powerful enough to push for more local governance and grassroots projects, something Africa needs. Africa needs projects by the people affected by it, not some Billionaire who needs a PR bump to cover up their embezzlement of riches.
A home worthy of a return.
Many Africans have fled the continent in search of greener pastures, some with good memories, some with awful ones, but despite that, I think that it cannot be an easy decision. For someone who has been contemplating my escape, I know the decision isn’t an easy one to make, but one many more will make as the nations here deteriorate under a fiat standard.
Many of the top talents we’ve lost to developed nations will be able to come home, to bring back their value production. They bring back with them their capital, their expertise, their networks and can foster new traditional relationships that are mutually beneficial where transactions are settled with instant cash finality and no rent-seeking middlemen sucking out capital for owning the rails.
This will all help build the continent into the global powerhouse this sleeping giant always had the promise of becoming.
We don’t need foreign assistance; we need a way to assist ourselves.
We don’t need foreign aid; we don’t need handouts; we don’t need bailouts. We need an internationally recognised unit of account that is an even playing field for anyone who wants to take advantage of the rails it provides.
The potential is there, the labour, the skill, the talent, the resources, it’s all there, it simply needs a method of connecting them, and to me, the best bet is Bitcoin.