Over the course of the previous three years, Africa has witnessed a meteoric rise in the number of people using cryptocurrencies. According to a report published by an American data firm called Chainalysis, the unfavorable economic conditions and financial systems that exist on Africa are contributing to the continent's ongoing trend of increased cryptocurrency adoption.
You can make money with cryptocurrencies or use them to make transactions, especially international financial transactions, take place more quickly.
Tadi Tendayi, a man who resides in Africa, is of the opinion that cryptocurrencies have greater potential.
Tendayi, a crypto enthusiast from Zimbabwe, is on a mission to reimagine cryptocurrency by developing blockchain infrastructure in order to make the lives of as many Zimbabweans as possible better.
"We support ten vulnerable women through crypto on a daily basis with a dollar, and we also support five children through their education for the next two years. " And all of this is accomplished with crypto."
In a world where most people are concerned about the best time to buy or sell cryptocurrency or even the quickest ways to facilitate cross-border payments, Tendayi wants to leverage the power of cryptocurrencies to assist those who are most vulnerable in African societies.
The journey toward discovering crypto has always revolved around the possibility of making a significant amount of money, and this is true for everyone from the founders of blockchain and crypto companies to expert crypto traders.
However, Tendayi's interest in cryptocurrencies started with his fascination with the technology behind blockchains. Even though he had no interest in making money with cryptocurrencies, he had no choice but to participate in crypto trading and other crypto practices that generate income in order to gain a better understanding of them.
Tendayi's only motivation was to learn about the inner workings and applications of various cryptocurrencies. Before he made a friend from Tunisia, he had never considered using blockchain technology for anything creative.
"At the time, I wasn't giving much thought to the construction of my blockchain. We were focusing on the currently operational blockchain and did not take into account layers one or two. Then, I happened to run into a friend of mine from Tunisia who was working on a pilot project in Rwanda involving Celo. I questioned her about it, and after she gave me her response, I started looking into Celo.
The Celo blockchain network is a layer one blockchain that operates in a manner that is distinct from many other blockchain networks.
Bitcoin, Ethereum, and Litecoin are all examples of blockchains that fall into the category of layer one blockchains. A layer one blockchain network is a sustainable blockchain network that is capable of processing and finalizing transactions without the assistance of any other blockchain.
On the other hand, a layer two blockchain makes it possible for a layer one blockchain to function more efficiently. This is analogous to how a Chrome browser and the extensions it offers work together. It is an additional layer to the primary blockchain, which is known as layer one.
Tendayi was unaware that blockchain possessed all of these functionalities at the time. During his investigation, he found out that it was a mobile-first blockchain, which meant that a person's mobile phone number or email address could serve as their cryptocurrency address. This innovation could, in essence, create mobile money but for cryptocurrencies.
Tendayi has started to formulate some of her thoughts. Because he saw the potential for blockchain technology and cryptocurrency to solve problems that were specific to Zimbabwe, he decided to build BitFlex as a layer two blockchain on Celo. This was the beginning of his journey building with blockchain.
A solution that was important in Tendayi's mission to build a blockchain for vulnerable communities was the creation of BitFlex, which is a fintech platform that bridges the gap between cryptocurrencies and fiat currencies by making cryptocurrencies simple enough to use.
Because the Celo blockchain was designed with mobile use in mind from the beginning, anyone in possession of a mobile device can access it, rendering the use of a personal computer superfluous. As a result, we started looking into the speed of Celo; since it is faster than Ethereum, Bitcoin, and Litecoin, we started thinking about how we could use Celo for everyday use cases.
Particularly important for Zimbabwe is the use of blockchain technology as an alternative to traditional financial systems. Tendayi brought up the fact that the nation was subject to sanctions and restrictions, which rendered the previously established economic systems unreliable.
Sanctions have been placed on a country like Zimbabwe, and as a result, people living in that country are prevented from gaining access to fundamental resources that should be available to everyone. With all of these restrictions, it's possible that you won't even be able to open a bank account or register for a cryptocurrency exchange like Coinbase. However, blockchain technology does not have these limitations, and Bitcoin is not subject to any sanctions.
Even though there are no regulations governing Bitcoin, there are still some obstacles to using it, the most significant of which is education. The use of cryptocurrencies is made more difficult by the significant gap that exists between them and traditional banking systems.
Because of these complexities, users of cryptocurrencies who are not well informed have been susceptible to falling for crypto scams, which have resulted in the loss of one billion dollars since 2021.
This is where BitFlex from Tendayi comes in to play. BitFlex entered into a strategic partnership with GoodDollar in December 2021. GoodDollar is an initiative that was developed to promote Universal Basic Income (UBI) in Africa and facilitate a financial revolution through the use of cryptocurrencies.
" What we are doing with GoodDollar is utilizing cryptocurrencies in order to assist disadvantaged communities by utilizing decentralized forms of finance ( DeFi). The onboarding procedure consists of a webinar that lasts for half an hour. The beneficiaries are put through a training program that covers how to download the app, how to transfer money, and how to cash out in their native currency.
How do people who live in disadvantaged communities make use of DeFi? When Tendayi mentioned it, that was the thought that immediately came to my mind as a follow-up question.
He explained that DeFi is a method for continuously generating funds whenever BitFlex or GooDollar is given a donation. Because BitFlex uses the layer one technology developed by Celo, beneficiaries are able to easily use their phone numbers as cryptocurrency wallets.
If someone were to give us, for example, $10,000, the amount will never change from $10,000. On the other hand, we invest and put the money we make back into the communities and organizations that benefit from our work.
The process of ensuring that the proceeds are distributed to the appropriate beneficiaries is automated by smart contracts. Smart contracts, much like traditional contracts, are an agreement between parties; however, unlike traditional contracts, smart contracts have the ability to carry out the terms of a deal independently of the parties involved.
If a contract stipulates that twenty beneficiaries will each receive 2 percent of the proceeds from the DeFi, then the smart contract will distribute 2 percent of the proceeds to the beneficiaries automatically.
It's interesting to note that even the person who initially created the platform or the contract can't halt the process.
Even though increasing the amount of money generated through donations to DeFi could guarantee a steady stream of returns, the cryptocurrency market is too volatile to guarantee continuous returns at any given time. When dealing with cryptocurrency, inevitably there will be losses.
We actually use platforms that are regulated by the Financial Conduct Authority (FCA), and these platforms have a guarantee insurance policy for a total of 375 million dollars.
The risks that are associated with cryptocurrency are difficult to manage, even with insurance and regulation. One recent example that serves as a good example is the recent crash, which resulted in top crypto companies having to lay off workers in order to stay in business.
However, Tendayi's solution has been successful to this point, and it is currently able to pay the annual tuition of five Zimbabwean children and provide a dollar per day to each of ten different women.
But for Tendayi, this is just the beginning, and he will continue to innovate and create new ways for people in Africa to get the most out of cryptocurrencies.