Blockchain technology does not just revolve around digital currencies like bitcoin. The much hyped distributed ledger technology has a variety of applications and Africa has not been left behind in implementing blockchain solutions to drive development and growth across the continent.
Blockchain startups like Kenya’s ChamaPesa and Bitsoko to Nigeria’s NairaEX to South Africa’s BankyMoon, Wala and The Sun Exchange, and even Zimbabwe’s Bitfinance and Golix have ensured development in different communities within Africa and handled the continents major problems like inflation.
Blockchain startups in Africa were mainly built as a ground that would allow crypto and blockchain trading. They faced a lot of criticism from most people who saw it as a scam that would create a lot of tension due to FOMO. These companies, however, did not give up. They continued to create awareness, grow and raise funds for Blockchain to its maturity today. Blockchain has helped create transparency and trust between different nations.
Blockchain startups Funding
According to WeeTracker, most funds come from the Venture Capital Firms that are not in Africa since investors who can help are few. In 2019, a total of $1.34 billion venture capital was raised, while in 2018, $725.6 million was raised from venture funding.
Despite the impressive growth rate, many startup companies are still not able to fund themselves in the early stages. So many gaps still need to be filled within the continent; a good example is Nigeria.
Quartz Publication says that Nigeria has the most substantial venture capital of over 50% of the total raised. However, only $1.5 million came from the $133.5 million raised in 2018.
Blockchain applications in Africa
Land ownership issues in Africa are being tackled with blockchain technology. It has the potential to automate the entire process without fraud or manipulations. A good number of African companies like Bitland in Ghana have adopted this. Bitland deals with landowners and stakeholders while offering services in survey and record keeping using Bitshares blockchain.
Farmers in the Agribusiness are using Blockchain to record, issue credit cards, and process payments. George Maina, the co-founder of Shamba Records, uses big data and an AI(Artificial Intelligence) to collect farmers harvests and record them. In Nigeria, the Agritech startup “Hello Tractor” uses the blockchain technology to reduce prices between farmers and tractor owners.
Blockchain solutions are being used during elections, to make trade finance transactions, and to track the origins of cobalt. The co-founder of Microtraction and director of Binance Labs, Yele Bademosi, says that Blockchain is helping in solving counterfeit issues. She adds that Blockchain has made it possible to trace the origin of natural resources and promoted the fight against corruption.
This technology is solving the money transfer problems like delays in transactions linked to companies like Western Union and even Money Gram. The World Bank claims that in 2015, Africans in diaspora remitted $35.2 billion to their homes and accrued 10% of the total transfers through third party services. With Blockchain, third-party service providers are not required.