Binance Labs Director Benjamin Rameau has stated that Africa is front and center of the company’s expansion strategy as it bets on a vision of the 21st century driven by the world’s youngest population gaining increased access to technology and opportunities.

In June, CCN reported that Binance began actualizing its African expansion strategy when it opened Uganda’s first ever Fiat-Crypto exchange offering trading pairs with the Ugandan Shilling.

Contrarian Investment Ideas

In a detailed blog published on his Medium page, Rameau comprehensively outlines why Binance believes that the future is African, starting with a historical comparison to Asia in the 1960s – also an under-serviced continent with a poor population.

According to him, the same contrarian investment strategies that proved extremely successful as Asia kicked off an economic miracle in the face of all expectation are likely to reap similar rewards in 21st century Africa.

The post goes on to state that unlike in developed markets where it competes with a flawed existing financial system, crypto has the potential to build a completely new financial system in parts of Africa where to all intents and purposes none currently exist, such as South Sudan where only 9 percent of people over 15 years old have a bank account.

Earlier when CCN reported on Binance opening up in Uganda, the story noted that Ugandans’ access to financial services has grown rapidly over the past decade, driven by digital inclusion through a wide adoption of mobile money platforms. According to a World Bank news report, there has been an over 100 percent rise in the number of adult Ugandans with access to formal financial services since 2009, but the total percentage of the population with this access is still about 16 percent.

From a Binance perspective, this scenario contains the real possibility for huge growth. Essentially, an entire generation of hundreds of millions of young, technology-receptive people could come into crypto finance as their first ever experience of a structured financial system, establishing crypto as a default paradigm on the world’s largest inhabited continent, which would be game-changing for crypto perception and adoption worldwide.

Expanding on this Rameau states:

“Access to financial services for saving, borrowing and protection will provide the capital to fund entrepreneurs, provide a safety net for retirement planning and provide disaster relief. Renewed optimism about the future will arise when people are given the freedom to take on risk. Households will have fewer children and invest more per child on education when parents can pre-finance their retirements. This will form the backbone to the modernization of African economies.”

Industrialisation, Jobs, Governance, Scalability and Stability

According to Rameau, the 20th century model of industrialization which involved creating large industrial parks for manufacturing activities will be completely disrupted in a decentralized world due to the rise of technology such as 3D printing and cheap high-speed transportation, which will enable on premise, on-demand manufacture. Reducing the current industrial model to a relic will see Africa better able to compete in the global economy.

Another reason Binance sees a large future in Africa is the potential for crypto to integrate a vast continental market of more than one billion people which has a shockingly low level of intra-regional trade. Due to anachronistic, colonial-era barriers and restrictions, it is often easier and less expensive for an African country to trade with a European country than with its neighbor next door.

Crypto has the potential to quickly and comprehensively upstage the status quo using internationally recognized stores of value and watertight smart contracts amongst other blockchain-based solutions. Use of DAOs will prove to be a winning strategy for effortlessly sidestepping the legendary bureacracy involved in trading among Africa 55 countries.

The growth of the crypto economy will also create more economic opportunities for young Africans who will be placed to tap into the benefits offered by outsourcing from wealthier economies. Apart from improving the continent’s balance of trade and human development indices, the growth of economic opportunities on the continent will help to stem the flow of young Africans migrating to Europe and beyond in search of a better life, which is a major political issue in the world today.

Finally, Rameau mentions crypto’s usefulness as a stable alternative to Africa’s poorly performing national fiat currencies and as a means for sidestepping and preempting government-level malfeasance. As has already been proven in Zimbabwe, crypto can become a stable basis for an economy ravaged by high inflation.

Beyond that, however, DAOs allow small and large projects to be executed trustlessly in line with preset parameters determined by aligned interests. It is thus possible to effectively tokenize governance and make it impossible for public officials to steal funds or misuse their positions to the detriment of the public good.

According to Rameau, Binance sees itself as an African country, the same as it is Asian or European because the decentralization of DAOs makes them perfectly able to adapt to local circumstances while still being truly global.

CCN earlier reported that Binance pays more than 90 percent of its staff in its platform’s native BNB tokens, as part of the company’s effort to position itself as a much bigger value proposition that just a cryptocurrency exchange.

This post credited to ccn  Featured image from Shutterstock.

While the cryptocurrency market continues going through a wobbly phase with weak asset prices and little sense of an imminent recovery, job creation figures related to the blockchain and cryptocurrency sector across the world’s most populated continent are recording a very firm and noticeable uptrend.

Across Asia, both startups and established corporations have set blockchain technology adoption firmly in their sights, according to an August 31, 2018 report by CNBC.

50 Percent Increase

The report states that following the crypto market bull run of 2017, interest in blockchain and cryptocurrencies has spiked across Asia, with both new and established businesses racing to incorporate blockchain technology into their operations.

According to data from the recruitment company Robert Walters, there has been a 50 percent increase in 2018 over 2017 in the number of job roles related to blockchain or cryptocurrency, with heightened interest in particular on programmers with Python language proficiency.

Whether it is at established legacy businesses like IBM or newer upstarts like Binance, Asia is creating blockchain-related job opportunities at an unprecedented rate. This is also reciprocated by jobseekers, according to data from job postings board Indeed. Pulling data from its vital Asian markets namely Malaysia, India, Australia, and Singapore, Indeed confirms that job seekers across the continent display heightened interest in blockchain roles.

Speaking to CNBC, Julian Hosp, Cofounder of crypto wallet startup TenX revealed that the relative infancy of the blockchain industry in Asia makes it difficult if not impossible to hire talent for new roles from within due to the sheer number of new roles needed versus the number of people with the requisite skills actively involved in the industry. As a result, he explains, companies are hiring blockchain talent from outside the space.

In his words:

“We hardly ever hire from inside of crypto because most people inside of crypto are very inexperienced. You have very, very few people who are experienced who get into the crypto industry.”

John Mullally, a financial services director in Hong Kong, confirms this, stating that while there is indeed a significant amount of interest in new blockchain roles, the number of people with the required skill set to fill those roles is relatively low.

This bears out an earlier report by BTCManager where it was revealed that the demand for blockchain talent far outstrips supply, effectively making it an employee’s market, with starting developer salaries going as high as $100,000 in some cases.

Interest Volatility and Lag Effect

According to Julian Hosp quoted earlier, the vagaries of the crypto market do have some effect on companies’ decisions to invest in blockchain talent.

He said:

“If crypto is doing well, if people are making money in crypto, we get huge inbound from people because they feel like, ‘I need to jump on this wave.”

Giving a counterpoint to this, Justin Chow, Asia head of business at Cumberland says that many conventional finance professionals have become interested in moving into crypto over the past three to six months after the initial lag effect caused by the price crash.

According to him, the delay between initially having their interest in crypto piqued in December 2017 and looking to get into it now in late 2018 is likely because many professionals did not want to risk their careers on a price surge and so they decided to wait it out.

In May 2018, BTCManager reported that cryptocurrency hedge fund manager Olaf Carlson-Wee believes that top-tier tech talent is joining the crypto industry “in waves.”

 

This post is credited to btcmanager   Image source: btcmanager

1.The appeal

Blockchain technology is beginning to move past cryptocurrencies into companies and now governments. Countries around the world are trialing the emerging technology in areas from recording votes in elections to storing the records of citizens.

Distributed ledger technology (DLT) or blockchain as it’s more commonly known was pioneered by the creator of bitcoin, a digital currency. Bitcoin’s blockchain is a public ledger of activity that stores information about all the transactions taking place on the network. It cannot be hacked or tampered with and it is not owned by a central authority. Instead, a group of participants uphold the network.

CNBC has previously taken a deep dive into how exactly the blockchain works and its use cases in the corporate world. The key part about the blockchain is that it allows several parties that don’t necessarily trust each other, to share a common database that is cryptographically secure. This means that complex processes like contract negotiations could be made cheaper, faster and simpler.

“I think one of the biggest potential promises for governments is credibility enhancement and blockchain at its core. It fundamentally is a way to minimize the degree of trust that is required, and governments all over the world have historically struggled with maintaining wide trust at all points in time.”
Garrick Hileman, head of research at Blockchain and co-founder of Mosaic.io

Blockchain, which was once viewed skeptically by governments worried about its affiliation with bitcoin and other cryptocurrencies, is in vogue. Experiments are taking place globally into how the distributed ledger technology could be used on a national level. Of course, it would not mimic the bitcoin blockchain, but instead take the principles of a distributed trust-based system and apply it to government processes.

DLT is still in its early stages and there are still many problems to overcome before scalable government-level uses of the technology can be seen. CNBC takes a look through how blockchain is being used by governments.

2.State-backed cryptocurrencies

Given blockchain first began with bitcoin, it’s a natural next step that nations would begin thinking about their own digital currencies. Several countries have talked about state-backed cryptocurrencies but exactly how they work or what they will look like is still up for debate.

Venezuelan ‘petro’

The first country to actually introduce a state-backed cryptocurrency is Venezuela. It’s known as the “petro” and was launched earlier this year in a bid to raise money amid economic meltdown and sanctions.

Venezuelan President Nicolas Maduro says the digital currency is backed by oil and it raised $735 million when it was first released. And in the latest attempt to save the country’s economy, Maduro devalued the Venezuelan bolivar and introduced a new fiat currency known as the “sovereign bolivar,” which will be backed by the petro.

But the petro does not trade, unlike most other major fiat currencies, and it has been called a scam by experts and illegal by Venezuela’s own parliament. It may seem odd for a country to introduce its own cryptocurrency, but Maduro’s comments in August highlight the motivation.

“They’ve dollarized our prices. I am petrolizing salaries and petrolizing prices … We are going to convert the petro into the reference that pegs the entire economy’s movements,” he said.

Venezuela would like to see the dominance of the U.S. dollar depleted and Maduro said last year that the country would like to “free” itself from the greenback.

But Venezuela’s attempt at a state-backed cryptocurrency might not be the route for others to copy, according to Jeff Schumacher, founder of BCG DV, an investor in blockchain start-ups.

“State-backed cryptocurrencies in regimes like Venezuela will do nothing to stimulate economic recovery. Whether standard or crypto, any currency needs to be backed on the fundamentals of the underlying economy,” Schumacher told CNBC by email.

“Venezuela’s economy is in shambles and creating a crypto will not change that. Most people won’t value it because they don’t believe in the government or the economy. History will inevitably repeat itself and we will likely see Venezuela’s petro collapse.”

‘De-dollarizing’

China and Russia are among the nations that have talked about state-issued digital currencies. Others include Turkey, Qatar and Iran. The similarities between them include being reliant on the U.S. dollar, as well arguably having somewhat authoritarian regimes.

Cryptocurrencies are seen as a way potentially to reduce reliance on the greenback as well as have more oversight into where money is moving.

“Digital currencies may help a number of countries who are looking to de-dollarize to do that,” Hileman said.

“Cryptocurrencies, with their autonomy could offer a more independent and trusted alternative to the U.S. dollar, especially if they have backing of strong assets in terms of oil or gold in the early stage before they get a degree of stability where they don’t need that,” he added.

But Hileman said it was unclear how these state-backed digital coins would work. They could be issued by a central bank and backed by an asset at the start, just like Venezuela claims its petro is.

It’s not just the more authoritarian nations looking into state-backed cryptocurrencies either. Others like Singapore are testing a way to use a digital version of the Singapore dollar for cross-border payments. Swtizerland’s government has also commissioned a study into the possibility of an “e-franc.”

A state-run bitcoin?

It may be a mistake to call state-run digital currencies “cryptocurrencies” because they may not necessarily run on a blockchain. Instead they could be digital versions of a country’s fiat currency.

“No one’s in a rush to get this done. Will it therefore be necessary for it (blockchain) to be part of a digital currency if central banks issued it? Well the answer is I think not,” Stephen Poloz, governor of Canada’s central bank told CNBC in January.

This would be a big difference from bitcoin which is based on a blockchain and is decentralized. On the other hand, state-backed digital currencies would be issued by a central authority, perhaps a central bank.

3.Other uses of blockchain

Blockchain technology offers the promise of more efficient and accurate processes because of how it works. And for governments that is exciting given the amount of data that they hold on citizens and how they are pushing to digitize much of that. Nations are also responsible for a massive amount of record-keeping which could move to the blockchain.

Let’s a take a look at some key trials of blockchain technology in government.

Voting

Elections are susceptible to fraud and human error. Blockchain has been touted as a solution to fix that. A number of trials have happened around the world. One of the most recent happened during West Virginia’s primary election in May. Select votes could use a blockchain-based mobile app to vote. It was created by a company called Voatz.

So how did blockchain voting work in this situation?

People voted via a mobile app which was essentially the equivalent of a ballot paper. The mobile ballots are “tokens” or potential votes which are cryptographically tied to a candidate. The voter makes their decision, it is verified by a number of different servers or computers known as “validating nodes.” Upon verification, the token or ballot paper is debited from the voter’s ledger and put on the candidate’s ledger. This is an automatic process and means that a single person cannot vote twice. And it’s now on a blockchain that cannot be tampered with.

Credit checks

China has been cracking down hard on cryptocurrencies and ICOs, but it has been focusing heavily on DLT. Earlier this year, Chinese President Xi Jinping said that blockchain has “breakthrough” applications.

Parts of the Chinese government have been working with blockchain firms in various areas such as credit scoring. One of those companies is Points which has partnered with a subsidiary of China’s Ministry of Industry and Information Technology and the China Academy of Information and Communications Technology to create blockchain solution for know your customer (KYC) and credit scoring.

The KYC product removes the need for institutions to repetitively conduct the process manually.

“With its partnership with the Chinese government, Points has access to verify ID and criminal records on 1 billion people in China. Thanks to Points’ blockchain protocol, the normally time-consuming KYC process which would normally be done manually, increases the efficiency for institutional partners,” founder Sarah Zhang told CNBC by email.

“It does this by reducing the institution’s need to store data on their own servers as Points because they can simply verify identities or other relevant information through blockchain that has already been verified before.”

This process could be used all around the world but requires data to be opened up to allow verification of a person’s identity and their credit score.

Supply chains

Supply chains are very complicated with several parties involved across many countries. Goods are passed between various parties and lots of contracts are involved in the process. This is a scenario where DLT has been tested.

At a government level, the U.K.’s food watchdog carried out a pilot using blockchain technology in a cattle slaughterhouse. In the pilot, both the Food Standards Agency (FSA) and the slaughterhouse had permission to access the data. They were able to share information on the supply chain, working off one ledger, rather than various different documents.

Blockchain-based supply chains is something several companies are trying out too.

These are just a handful of examples where blockchain has been trialed with many more in the works.

What next?

Blockchain is without a doubt one of the most-hyped technologies this year with people working in the industry seeing it as a silver bullet solution to many processes, which indeed it may not be. Trials are underway but there’s a long way to go before this becomes mainstream.

A number of competing blockchain platforms from Ethereum to Hyperledger are battling to become the dominant player. But one big problem for DLT is scalability, that is, whether it can work on a wide scale efficiently, which would be crucial for it to be effective at a national level.

Hileman said that with the price of cryptocurrencies rising and falling many developers of the underlying blockchain technology may have taken their “eyes of the ball,” but are now back to creating solutions that may come to market soon.

“We will see further work done in the next 12-to-18 months in testing various scalable solutions that will deliver on the promises we have heard about,” Hileman told CNBC.

“There are questions that have not been answered, but I’m confident they will be. There are smart people with different blockchain designs and one of these will work, several of these will work. Resources are there, brain power is there, it’s just a matter of time and I think we will see major advances in scalability.”

This post credited to CNBC   Image souce: CNBC & Getty Images

The internet has provided an unparalleled means of communicating with people all over the world. There are more than 60 billion messages sent per day on WhatsApp and Facebook messenger combined as well as 269 billion emails sent on a daily basis. However, these platforms have slowly become centralized over time allowing them to become prime targets for hackers and other actors seeking to harvest our data. Both of them have continuously threatened users’ rights to privacy.

Blockchain technology’s disruptive force innovates the way our data are stored, allowing users to fully control personal details they would like to share in public. Leveraging the potential of blockchain technology and decentralization may well be the key to protecting our privacy.

Centralized Threat

Facebook’s recent Cambridge Analytica data privacy scandal exhibited just how companies have harvested users’ private data for monetization purposes. An estimated 87 million users around the world have had their personal information used by analytical firms, making it one of the worst data breaches in social media history. While this isn’t new, it highlights the inadequate data protection that exists in our current platforms.

Technological advancement has revealed another way to manage our data through blockchain technology. But this method isn’t something novel, in fact, it harkens back to some of the earliest ideas of the internet. Decentralization set the stage for the unparalleled World Wide Web we know today. It is also a central feature of blockchain technology.

Distributed Privacy

Blockchain provides an infrastructure that allows a secure platform that provides multiple innovative use cases. The immutability and transparency that blockchain provides can gain back users’ right to privacy. However, this technology is still in its infancy.

Credit: Forbes