Crypto Assets in Africa: Simple and Pure

A few months ago, I set foot on the hot land of Africa once again. The dust kicked up by the speeding pickup truck, along with the afterglow of the setting sun, outlines a strange yet familiar impression of the African continent. Being an outsider provides enough space to assume the role of a "global citizen" and to ponder who I am, what I am doing, and the relationship between the Crypto Assets industry I am engaged in and the world.

In-depth exploration reveals that Crypto Assets offer underdeveloped countries in Africa an opportunity to resonate with the world once again. From these countries' faith and determination in Crypto Assets, we can see that they are no longer satisfied with compromising with the old systems and structures. Rather than struggling in the mud and being dominated, why not fully embrace Crypto Assets and rush towards a bright future.

At the end of Token2049, with the deep social interactions with some colleagues these days and the rampant negative emotions, I recalled a small incident from a few weeks ago: about "Is the Crypto Assets industry really over?"

I have been living in Paris for two years now. One day, while working remotely from a small café at my doorstep, I suddenly received a call from Uganda. After a mix of surprise, delight, and confusion in our greetings, I counted on my fingers and realized that it had been 7 years since I left the traditional industry in Africa to dive into Crypto Assets.

The call was from a senior advisor of the Ugandan government, who came to China accompanying the president for the Forum on China-Africa Cooperation. During my years of experience in Africa, I worked for state-owned enterprises and the UN International Development System, aiming to promote the industrialization process and inclusive finance in Africa. With his help, we collaborated on various projects such as investment promotion for China-Uganda cooperation and the promotion of Ugandan women’s handicrafts, which led to a friendship.

The experiences of those years living in Africa can actually be elaborated on for half a lifetime. There are grand stories, like laughing and chatting with the President of Senegal at his home, and there are life-or-death situations, such as the tragic death of my good friend's boyfriend in a terrorist attack in the business district we always visited in the capital of Kenya. Due to a last-minute mix-up, we changed flights and avoided the most serious aviation disaster in Ethiopian Airlines' history, but my high school classmate and several acquaintances within a third-degree network, including friends' colleagues, unfortunately lost their lives. However, the decision to leave Africa was also resolute and firm.

This all begins with an unexpected encounter with Crypto Assets. Interestingly, seven years later, while chatting with new and old friends in a café about Crypto Assets, the stories from Africa are a topic of interest for everyone, as if it's a utopia escaping from a difficult reality, a psychological solace that romanticizes exotic adventures.

However, I believe that the soul-searching questions and answers about the application value of Crypto Assets are actually found in those seemingly whimsical and ethereal stories.

Transfer of Value ------ Where is the money, how to spend it? Where to spend it?

Everyone may know a resounding vision from a certain trading platform: to increase the freedom of money. So, to ponder whether the Crypto Assets industry is doomed is a profound question. Let's first raise this issue and take a look at how several global value chain shifts occurred in history, what stage of historical development we are currently in, and why such a slogan exists.

Let's start with the old "narrative". Historically, there have been three global industrial revolutions. The "Steam Revolution", which originated from the invention of the steam engine in the UK, greatly enhanced productivity, allowing small-scale handicraft textile workshops to achieve large-scale industrial production; during the "Electricity Revolution", breakthroughs were made in fields such as electricity, chemical engineering, and heavy industry in the UK, the US, Germany, and France, leading to the development and improvement of the entire European industrial system. The third revolution is the "Information Revolution" that we are familiar with. The surge in industries such as information technology, computers, electronics, and automation propelled countries like the US and Japan to become significant players in the world economy. The "Four Asian Tigers" (South Korea, Taiwan, Singapore, Hong Kong) also underwent rapid industrialization in the latter half of the 20th century, developing advanced manufacturing and financial industries, integrating into the global value chain system.

It can be seen that each industrial revolution represents a transformation in productivity that brings about changes in production relations, thereby prompting some countries to leverage their "comparative advantages" to participate in the global value distribution system. China has benefited from the reform and opening-up that began in 1978, learning from the advantages of the rise of Singapore and other Asian Tigers. By constructing special economic zones and industrial parks in the developed coastal regions, utilizing China's low labor costs, large workforce, and hardworking "comparative advantages", along with opening up markets and attracting foreign investment, it has developed export-oriented manufacturing in some coastal areas, becoming the "world's factory" and establishing and consolidating its indispensable position in the global value chain distribution at that time.

The intricate details of the grand industrial revolutions over the past century could be extensively documented, but that is not the focus here. It is worth mentioning that each industrial revolution is also a process of wealth redistribution. Africa, due to its long history of colonialism and various complex industrial policies and international political factors, has not been involved in this "cake-sharing" process.

Is Africa really that poor? The capital of Nigeria, Lagos, has the highest density of private jets in the world. After exchanges launched local payment channels in Africa, the per capita trading volume in Africa far exceeds that of European and Asian countries. The wealth of the rich in Africa surpasses our common understanding and imagination. Due to Africa's abundant resources, especially oil and agricultural resources, those in the upper class can live for generations without worrying about food and clothing, while ordinary people are forced to scrape by in the tertiary sector—services—receiving only a meager share for basic survival. The entire continent has a gap in manufacturing, and the financial industry is monopolized. Due to the lack of infrastructure, the costs of financial services are extremely high, making it impossible for ordinary people to have a bank account or afford bank transfer fees. The stark and almost absurd wealth disparity is a common condition in Africa.

During a research project by an international organization back then, the Djibouti government arranged for us to stay at the Kempinski Hotel, which is the most luxurious hotel in this desolate East African tiny nation, costing 300 US dollars a night, which is the income of many locals for half a year. I still remember a moment, lying on a beach chair by the Red Sea at this hotel, a white businessman smoking a cigar and engaging in loud discussions, while in front of him, a black waiter held a tray, standing straight with his back, his white shirt and red vest complementing his dark skin. He gazed into the distance at the mist over the Red Sea, his eyes filled with numbness and confusion.

Our work at that time involved a group of young elites with degrees in economics, finance, sociology, and other fields from top universities around the world. We had to design how international organizations would allocate and spend aid funds for Africa, and how to ensure these funds would be effective. We had a British girl who had just graduated from Oxford University, and when she heard that we would be staying in a luxury hotel costing 300 dollars a night, she refused to stay, with tears in her eyes, as she felt it was a mockery of her subject. However, when she saw the living conditions of ordinary people—houses covered with iron sheets, creaking in the extreme heat of 50 degrees—she silently withdrew her insistence.

It was around that time that I decided to give up that job. Although what we did seemed compassionate, we talked grandly about industrial transfer, about developing manufacturing in Africa, integrating into the value chain, getting ordinary people into factories, and learning from China's and Southeast Asia's experiences in garment and shoe production. I personally stayed in a Chinese factory in Senegal for a month, interviewing female workers and watching them produce low-grade sports pants for export to Europe and America. But it was too slow; within the vast traditional "aid" system, those who benefited the most were probably not the African female workers being "taught to fish," but rather the senior clerks sitting in London offices writing papers and conducting project audits, as well as us international organization elites who stayed in $300 hotels with travel allowances. ------------ Data also shows that in the entire chain, as much as 70% of the funds were consumed in "proving how this money was spent, where it was spent, generating audit reports and impact reports."

I started to see blockchain, see Crypto Assets, blockchain technology, the fourth revolution led by artificial intelligence, has become the destiny of currency reform, the destiny of Africa, and the destiny of the vast impoverished masses.

True Decentralization at the Kampala Vegetable Market

The son of the Prime Minister of Uganda established a Crypto Assets organization a few years ago. Several "second-generation officials" and tech enthusiasts who studied in the UK and the US came together to work on a few small projects related to Crypto Assets, such as enabling peer-to-peer transfers of Crypto Assets using non-smartphones in areas with no 3G network. Africans understand Africans better; most locals are using non-smart phones that can only make calls and send texts. Since many Africans do not have bank accounts and are unwilling to travel across the city to find a Western Union or one of the few banks for transfers and remittances, the local remittance method is straightforward and direct: mobile phones based on USSD technology can send money directly to friends via text messages, and each person's phone number serves as their "wallet"/account, while the balance on their phone is their account balance.

I personally experienced a smooth "registration, KYC, transfer" process with friends from this organization: I bought a $50 phone at a telecom operator next to the Kampala vegetable market, queued up, and the counter staff, who have performed the KYC process thousands of times, completed it in 3 minutes. The staff helped me top up my "phone bill" with cash; there are numerous fixed and mobile official/unofficial Kiosks (small booths/service points) in the village. When you want to 'cash out', you just find the "village representative" on duty at the Kiosk, send him a text message for transfer, and he gives you cash. "Top-up" is the reverse process. The entire experience was smooth and completely point-to-point, with no third parties involved, eliminating any trust issues. This product and process are not only in the capital but have also deeply spread into the rural areas.

Later, I joined a trading platform, and the first year was about responding to the big boss's "mass adoption" vision, laying out a network in Africa that was truly based on blockchain and Crypto Assets. We started by implementing the most basic charity projects, which gave rise to charity initiatives. On the world's first completely "transparent" peer-to-peer donation platform, due to the characteristics of blockchain, every onlooker on the internet could supervise each Crypto Assets donation, which directly reached the wallets of Ugandan villagers without going through any third party. The villagers then used Crypto Assets to purchase potatoes and cabbages from vegetable suppliers who accepted Crypto Assets, without any involvement of fiat currency throughout the process. When the vegetable suppliers needed fiat currency, they would regularly convert Crypto Assets into local fiat currency through local exchanges or OTC.

Later, we also launched the world's first (and possibly the only one to date) "value-stable coin" on the public chain: Pink Care Token. Unlike other stable coins, Pink Care Token is not pegged to the "price" of any fiat currency.