Chinese Exchange To Spur Blockchain, ICOs, Altcoins in Africa
Interest in blockchain technology and more altcoins would surge among many Africans if and when a plan by Binance to start operating in Uganda pans out well. The plan was disclosed this week by the founder of the world’s top cryptocurrency exchange, Changpeng Zhao (CZ), while he was in the East African country on a two-day visit to explore opportunities for the use of blockchain technology.
CZ was invited to the country by the Blockchain Association of Uganda to deliver a keynote address at an African blockchain conference. He used the opportunity to visit the President of Uganda, Yoweri Museveni. He told Mr. Museveni and the prime minister, Ruhakana Rugunda, that he wants to set up Africa’s largest exchange in Uganda which could lead the inflow of capital into the country’s economy. As part of the plan, Binance will also develop a talent pool in partnership with Crypto Savannah, a blockchain innovation centre. They will train a thousand experts who will in turn train others in skills that are expected to empower youths to build businesses that would attract investments through the blockchain-based crowdfunding mechanism, ICO – or Initial Coin Offering.
ICO – Main Deal for Africa
Several industry experts have shared that a major way Africa could benefit from the crypto evolution is through ICOs. Considered to be a continent that has what it takes to innovate except funding, ICOs are a unique opportunity for African startups to raise money since it is hard for projects to get funds across the continent.
Most countries in Africa are underdeveloped – at least in the IT sector – hence the need for innovative startups to bring positive change and boost local economies, according to Bellaj Badr, the CTO of MChain in Morocco.
“However, we have an inefficient funding ecosystem including banks which are not keen on granting credit or investing in highly risked structures,” says Badr. “Consequently, project holders face many difficulties to initiate their projects or to keep it alive for more than 2 years. In fact, we have in Africa one of the highest Infant Mortality Rate of startups in the world due mostly to the funding problems. ICO represents a remedy and a smarter and accessible funding ecosystem. It will help startups to raise money from the cryptocurrrency community seamlessly and concentrate their efforts on innovation instead. Besides, the startups aiming for ICOs will mostly propose innovative services based on cryptocurrency and we all know how these currencies can help African people to solve issues related to logistical, unbanking, healthcare,etc.
The CEO of Potentiam, Marcus Adetola, agrees that the ICO model can work to fund public projects in Africa as it “helps create togetherness, support and an awareness of the development of a project where individuals become evangelists knowing they will benefit directly from the growth of the project. There’s no greater marketing than
peer to peer marketing especially in a continent with a huge population.”
Greater Exposure for Altcoins
Aside the ICO push, the launch of a Binance exchange in Africa could bridge the gap between crypto-based projects and more African investors. The close proximity will further demystify concepts behind several tokens and enable many Africans who have been mainly involved with top currencies like Bitcoin, Ether and Litecoin to diversify. Binance recently announced plans to move its operations to Malta where the globally-acclaimed exchange is expected to gain new ground as its platform appeals to users within the European Union.