Blockchain has powered solutions to problems around the globe. However, the impact of this technology has been felt most in developing economies due to the lack of infrastructure and functional systems in such regions. Decentralized technology has enabled builders and entrepreneurs in emerging markets such as Africa to provide people with opportunities and resources.
In an interview with Gwera Kiwana and Justin Norman of the crypto@scale podcast, Yoseph Ayele, a web3 researcher and investor, shared his thesis on the current Web3 landscape in Africa and why he believes crypto needs the continent.
Here are the top 4 takeaways from the discussion.
Crypto use cases are needed more in Africa than in developed economies.
As developed economies have well-established systems and functional infrastructures, most of the blockchain applications in such regions are used to solve problems that already have existing solutions. This limits the impact of blockchain applications in such areas. But in developing economies such as Africa, where there is a huge infrastructure gap in several sectors and industries, blockchain solutions have a higher potential for impact. According to Ayele, Africa has “a lot of infrastructure to create to really have vibrant activities in our economy.”
“Fundamentally, when you look at 50% or 70% of a [developed] country’s population, a lot of [people’s] needs are kind of met by centralized entities. So, all the decentralized technologies are competing with the well-entrenched and well-established legacy infrastructure and apparatus. If you look at Africa on the other side, we have an immense number of unmet needs that centralized bodies haven’t even tried to scratch the surface of. So, there’s a lot to build.”
Global Web3 communities need to connect with local African communities to foster development.
Having led a month-long learning trip with the Ethereum Foundation to Ethiopia, Kenya, Zambia, and Ghana, Ayele shared how he served as a bridge builder and translator between global crypto communities and African ecosystems. He saw the hunger and passion to learn and grow in young Africans while visiting blockchain communities at the grassroots. According to him, there is a need to build bridges to connect these local communities to the global Web3 communities.
“Ethereum as a network and community is very value-driven, and those values are extremely aligned with where many African builders and grassroots communities’ values are. … There’s just incredible value [here] and you can see it in people’s eyes. [There’s] just that hungry desire to learn and absorb on their own. But a lot of people are also learning by themselves and being fed whatever [content the] algorithms [of] Twitter or Youtube give them.
There just needs to be better bridges and connectivity between what communities are doing outside of Africa and then what’s happening on the ground,” he said.
Local use cases and homegrown solutions will determine Web3 adoption in Africa.
Due to its fast-growing youth population and potential for economic growth, the African market is receiving a lot of attention and investments from several stakeholders. As the infrastructure gap on the continent is vast, many local entrepreneurs are needed to close this gap. And Ayele believes that these local solutions, backed by global research and collaboration will drive the adoption of web3 in Africa. He said:
“Ultimately, my view is that a lot of the homegrown applications and technologies [are] going to drive real Web3 adoption across the continent … I think what we need [in] Africa [is] more builders, more founders, and more entrepreneurs who are playing a long-term game in the space. [Those] who are building applications, and protocols that are meeting real needs instead of falling [into] the trap of [raising a lot of] money from [venture capitalists] who don’t understand Africa.”
Africa needs to be borderless to rise in the global financial system.
In the global economy today, Africa is considered to be the least integrated continent. Due to the lack of systems and infrastructure, many nations and financial players on the continent are limited. According to Ayele, unless the status quo changes, “our position at the bottom of the pyramid is pretty much locked in for the next 50 to 100 years.”
“To me, what a borderless Africa really looks like is [when] a young person born anywhere on the continent [can] have full access to a global economy, [and] have the ability to learn whatever that person wants to learn, [and] be a part of global cultures and communities.”