Africa is leapfrogging the US and Europe in its embrace of blockchain technology that could make it “wealthier than Western nations”, claims Cardano chief Charles Hoskinson.
Hoskinson has a vision to rebuild the social and economic infrastructure of African nations with blockchain technology.
Speaking at the Financial Times Crypto and Digital Assets Summit, the Cardano founder said there was “more demand than supply” for its services within the world’s developing nations.
As of the time of writing the price of cardano (ADA-USD) is $0.53, and it has a market cap of $18bn.
Cardano see the deep-rooted centralised infrastructure underpinning Western nations as an obstacle that African nations can circumvent on their road to becoming web3 giants.
Speaking to Yahoo Finance, John O’Connor, head of African operations at IO Global, said: “DeFi certainly has huge potential for developing nations, especially those that don’t already have legacy infrastructure that prevents rapid innovation, and can make rollouts of blockchain smoother.”
Cardano see an opportunity in Africa’s younger population, who are eager to adopt new technologies with greater speed than their ageing counterparts in the global north.
Instead of relying on legacy systems of government, that are centralised and can yield to the hands of corruption, African nations could unleash the untapped potential of millions of people with the protocols of automated blockchains.Cardano USD (ADA-USD)View quote detailsCCC – CoinMarketCap (USD)0.5186-0.0261(-4.7860%)As of 6:45AM UTC.Market open.
At the Financial Times event in London, he described the chains of poverty that the blockchain can unlock, as its algorithms “don’t care who you are or where you are at, whether you are a Sengalese farmer or Bill Gates”, they just get the job done.
The algorithms of the cardano blockchain enable smart contracts that could give financial inclusion to billions across the African continent.
The ability to prove your identity, your education qualification, your rightful ownership of land or the ability to access loans is a luxury that the citizens of the US and Europe take for granted.
In Africa, hundreds of millions of people have no bank account, no access to reasonable credit, no definitive proof of qualifications and no proof that they own the land or dwelling where they have lived for generations. Because centralised government has failed them.
Cardano has made it their mission to fix this poverty trap and leapfrog African nations so they not only compete with the West but become world leaders “in AI and advanced robotics”.
Hoskinson explained that when Cardano’s protocols are installed, “that’s the way it stays and the users own the assets”. He added: “We have more demand than supply, and there are now more than 900 decentralised applications deployed on the Cardano ecosystem, with many involved in the GoveTech business, people see an opportunity there.”
But, what will now control the fate of billions living in Africa if its social, economic and governmental fabric relinquishes to the power of the blockchain. How can citizens be sure that the encoded protocols that guide their lives are not, in turn, guided by bad actors?
Cardano’s John O’Connor stated that the blockchain is provably secure, and not susceptible to manipulation from power groups. He added that “its protocol is guaranteed to be secure so long as 51% of the stake of its native ADA cryptocurrency is held by honest participants, which, in addition to other novel concepts, is achieved through random leader selection”.
He added that: “Governance is an essential step in the Cardano roadmap. This roadmap has five-stages; foundation, decentralisation, smart contracts, scaling and governance.” He described a Cardano governance system that would make impactful decisions about software updates, technical improvements and funding decisions, to ensure, “that the blockchain remains democratic.”
Cardano would enable a decentralised banking system that can issue micro-loans to people who do not have a credit or transaction history. By tracking peer to peer transactions, the blockchain will build an individual’s transactions history. O’Connor added that “when it comes to unbanked populations in developing economies, there is a real problem with individuals in rural areas lacking access to mainstream financial services. DeFi (decentralised finance) is a great tool to help improve economic inclusion.”
Forgery of land ownership documents is a problem in the African property market, and because of regime change proving property claims made under former regimes or after civil wars is extremely difficult.
According to O’Connor, Cardano plans to help eradicate the problem of land and property fraud by “storing property deeds on the blockchain so users can access these documents with only a mobile phone, and can be assured that they are secure and cannot be tampered with”.
He added: “This can be a particular benefit for refugees who may need to prove ownership of their land upon returning home, if these documents are stored on a digital ledger, they cannot be lost or tampered with thanks to the blockchain’s security. Cardano is provably secure thanks to Ouroboros, a blockchain protocol we designed, which features mathematically verifiable security against attackers.”
Cardano is not the only organisation that is pushing for Africa’s future to be blockchain-based. President of Tingo International Holdings Chris Cleverly also spoke to Yahoo Finance and described Africa’s cryptocurrency market as growing by over 1,200% in 2021, “the fastest rate in the world”.
Tingo is setting out to offer much-needed credit to the unbanked in Africa through microloans recorded on the blockchain through a pioneering SMS network where an internet connection is not even required.
Over half of Africa’s population have access to a mobile phone and Tingo’s new KamPay service will allow people to send and receive funds for their products and needs across a distributed secure blockchain.
Cleverly added that the blockchain service will reach millions of farmers across Africa with its SMS technology to provide micro-loans for as low as $2USD.
Cleverly describes the blockchain as having “a great role to play in solving some of our world’s greatest challenges such as tackling food security and facilitating economic development”. And he added that this technology is already here, “not some far-off, vague and poorly-understood concept or vision”.
Cardano has been slow to kick off the starter block, being years behind first movers like rival Ethereum, but they reckon that building the web3 world will not be a 100m sprint.
O’Connor said that as Cardano has developed slowly, with each step forward backed by peer-reviewed research, the blockchain is “now mature enough to underpin a blockchain solution which can scale to serve an entire national population”.
There is an expression that a day in crypto is the equivalent to a year in traditional finance, and proponents of rival blockchains have lambasted Cardano for languishing in development for what has seemed an eternity.
But, to understand Cardano’s laboriously strategy of rigorous research and development, it is apt to recall a saying by Abraham Lincoln, “give me six hours to chop down a tree and I will spend the first four sharpening the axe”.
Cardano began life in 2015, and until recently the team of developers have been sharpening that axe, but now the proof of stake blockchain is starting to cut, with the first stroke landing in Africa.