A lot has been written about the structural and institutional shortcomings evident in several countries in Africa. From corruption and poverty to diseases and war, African nations have seen so much written about their land and people.
But what’s not given enough attention are the many positive developments that are driving positive change across the continent. Blockchain adoption is a perfect example.
Industries across Africa are stepping up efforts in blockchain technology to drive real value, even though the general attention of governments still appears minimal.
As of today, the technology is widely used across a range of industries in Africa, including healthcare, financial services, public services, gaming and supply chains. The competition in various industries is pushing companies to innovate and shift to emerging technologies, such as blockchain in order to adapt and stay competitive.
1. Africa blockchain activity
Africa’s technology landscape is changing rapidly and blockchain adoption across the continent is gaining momentum at a fast pace. The main strength of blockchain is in decentralized data management.
But the majority of organisations in Africa are attracted to blockchain’s efficiency and ability to generate savings in transactions, among other benefits. Besides, several stakeholders in the African technology space view blockchain as key to fixing many issues Africa face as a whole.
For instance, curbing corruption within the public sector could be achieved by deploying blockchain in governance to help drive transparency and accountability. The technology provides an unprecedented level of security of the information and the integrity of records it manages, guaranteeing their authenticity. Moreover, it eliminates opportunities for falsification and the risks associated with having a single point of failure in the management of data.
Suitable areas where blockchain could help curb corruption are the registry of assets, verifying identity and tracking transactions.
2. Kenya blockchain report
Kenya, Nigeria and Sierra Leone are three notable nations that sought collaboration with the private sector to leverage blockchain accruable benefits. In July 2019, a task force on blockchain and artificial intelligence in Kenya submitted a report to the Kenyan government urging it to deploy distributed ledger technology in the public service. Additionally, the report advised the government to consider creating a national digital currency.
While there are no laws governing initial coin offerings (ICOs) in the country at the moment, Kenya has somewhat been favorable to cryptocurrency and blockchain. However, the Central Bank of Kenya recently warned against the proposed Facebook Libra currency citing “phenomenal” risks and uncertainty.
Meanwhile, Kenya’s neighbour Uganda has also jumped onto the blockchain bandwagon, partnering with a blockchain startup MediConnect to tackle the country’s counterfeit drugs problem. Uganda’s President Yoweri Museveni is a key advocate of blockchain adoption in Africa.
3. Sierra Leone national blockchain ID system
Sierra Leone is another country in Africa that is rapidly becoming a blockchain powerhouse in the region. The West African nation is not only providing an enabling environment for blockchain companies to operate in but also launching blockchain initiates of its own.
As previously reported by LedgerAfrica, Sierra Leone government said it is planning to fully adopt a blockchain-based national identity system by the end of 2019. Sierra Leone’s President Julius Maada Bio stated that the system will enable them to include more citizens into the nation’s financial system. The move also guarantees that the citizens are not left out from the worldwide digital economy.
4. Nigeria exploring disruptive ledger technology
In Nigeria, there’s a lot of activity to leverage the benefits of blockchain in both public and private sectors. Recently, the Nigeria Union of Road Transport Workers (NURTW) announced it was developing a blockchain system for improving interstate road transportation. NURTW is not working alone on the project but has collaborated with a group of partners in the private sector. It says the project will improve safety and enhance record-keeping and insurance for all travelers who use in Nigeria.
Cryptocurrency regulations is another interesting development regarding blockchain in Nigeria. Femi Gbajabiamila, the speaker of the Nigerian House of Representatives, recently said that the country should come up with a legal framework for blockchain and digital currencies. His sentiments were recently shared by Solomon Adaelu, a member of the House and current chairman of the bipartisan committee on blockchain technology.
Adaelu said that failure to move quickly on creating an environment conducive to digital technology risks leaving the country behind even as other countries across Africa embrace technology advancements.
5. Growth of blockchain startups in Africa
As African governments get their acts together, the private sector is springing forward. A growing number of blockchain startups are stepping up from across the continent to make meaningful impacts in critical sectors. Companies such as BitPesa, Pesabase, KuBitX, UTU, Jakuza, and many others have all originated from Africa.
UTU Technologies, for example, is a blockchain startup based out in Kenya building a trust infrastructure for the sharing economy on æternity blockchain. The company recently became the first blockchain startup from Africa to launch an IDO (Initial DEX Offering). UTU’s goal is to transform the online services industry by tokenizing the acquisition of users and data and creating a safe space to securely store and govern data access while providing monetary incentives for endorsing trusted service providers.
Foreign blockchain companies are also looking to make it in Africa as well. Paxful, for example, is a global peer-to-peer bitcoin marketplace that recently scaled its operations in countries such as Kenya and Nigeria.
Unlike other regions such as the U.S and Europe, startups do have an advantage in Africa when it comes to disrupting traditional industries. In the U.S., it is tough to disrupt big financial institutions at scale because the industry is mature, incumbents are entrenched and regulations are well-developed.
In Africa, the financial services industry is not as developed and so it offers more opportunities for disruption, such as in crypto-banking where startups such as BitPesa, Paxful, and Pesabase are hoping to disrupt.
Although many see the potential in blockchain applications, the attitude being adopted in Africa is still relatively prudent due to a lack of direct return. In addition, regulations, user acceptance and conflicts with other industries are all issues facing the blockchain industry.
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