In one of my recent panel discussions, all panel members shared their favourite innovation trend globally. While some talked about AI, cryptos and some about Alipay and Tencent, I mentioned that I was fascinated about the leap frog moments that Blockchain could create in emerging economies – especially Africa.
In the past I have touched upon usage of Blockchain by African farmers, and Blockchain for financial inclusion through social media based models. However, there are several fundamental problems that hurt Africa (and the other emerging economies), and Blockchain can potentially solve many of those. Having said that, the Blockchain ecosystem also needs to be careful about the hype they create.
The genuine use cases of Blockchain in Africa are many. As per a research report published in 2014 (slightly outdated, but still relevant) that Africa received about $30 Billion in Aid, but about 6.5 times that money is sucked out of the continent by richer nations sending that money. There is also another appalling statistic that less than 40% of charity money reaches the intended beneficiary in Africa.
A South African entrepreneur (Rufaro Masiiwa) has developed a blockchain based solution called Funds Aid, a platform that does the transfer of donation from the donors to the beneficiary in a transparent way with complete lineage. Beneficiaries are handed their private keys to redeem their allocated tokens.
The other fascinating blockchain use case is digital identifier. While this may be more of a defense mechanism against cyber attacks in the developed world, economic identity is critical to social and financial inclusion in emerging economies.
Smart contracts capabilities for real estate transactions in Africa is a good use case too. Bitland in Ghana was launched in 2016 to curb the corruption that happens in the real estate market. Real estate transactions are notorious for the scale of corruption that happens throughout the process.
Ixo Foundation in South Africa leverage Blockchain technology to optimize sustainable development impact. This is an attempt at creating an Impact ecosystem using the Ixo protocol.
Organizations and funders can use a decentralized impact exchange to create verified impact claims, essentially “proof of impact”. This proof can be used to access social impact bonds and government subsidies, and drives down the cost of evaluation. The data from these impact claims becomes a part of a global impact ledger, an open data commons that organizations, governments, and researchers can access to make informed decisions and optimize impact initiatives.
Inspite of all the good work, we see incidents where some in the Blockchain community over hype their roles and achievements. We have seen some incidents in the past few months, with IOTA involved in one of them, where they had to clarify on their relationship with Microsoft, which wasn’t a partnership as the press seemed to indicate.
More recently Agora was blamed to have misrepresented their (Blockchain’s) role in the Sierra Leone elections. Blockchain can be used to curb election fraud, and the initial press release seemed to indicate that the entire election in Sierra Leone happened on Blockchain. The national electoral commission of Sierra Leone confirmed that they didn’t use Blockchain for the elections, which led Agora to clarify that they had done a simple prototype to simulate the votes to illustrate that the technology could be used in a democratic election process.
The blockchain PR engine needs to stop misrepresenting its achievements. The world realises that the technology and the framework has potential. Its best to let the technology evolve and solve real world problems rather than creating unwanted hypes and bad press.
Arunkumar Krishnakumar is a Fintech thought leader and an investor.
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