Speculative investments and cryptocurrency crashes are occasionally associated with blockchains. Some start-ups are attempting to implement Web3 use cases in Africa, such as getting unbanked individuals online and into a more centralized financial system.
According to data from the Swiss Crypto Valley Venture Capital, or CV VC, while funding for African blockchain businesses raised $127 million in 2021, it has already reached $91 million in the first quarter of 2022, a 1,668% rise over this time last year.
African businesses have already started to address challenges like accessibility and fraud by leveraging block chain and automation to cut the costs of historically expensive operations, and more use cases are in the pipeline.
Growing Use Cases In Fintech
According to World Bank data, the use of mobile money, or digital currencies and assets made available outside of a traditional banking network, is substantially responsible for the rise in the proportion of individuals in Sub-Saharan Africa who have bank accounts. Greaves claims that as consumers look for more secure banking systems online, Africa’s “weak financial infrastructure” has contributed to an increase in blockchain use cases across the fintech industry.
Nigerian software entrepreneur Tola Adesanmi told Insider that the platform of rival Paris-based blockchain-based financial startup Eversend had considerably improved the convenience and effectiveness of his cross-border payments. The only thing he needs to do before leaving now is fund his Eversend wallet for automatic money transfers instead of having to exchange his naira for US dollars as he previously did when traveling outside of Nigeria.
According to the founder of Eversend, Stone Atwine, the platform was created specifically to address the significant challenges associated with cross-border commercial payments throughout Africa, which he referred to as blockchain’s best use case.
Identity Verification: Another Major Use Case
Along with other personal credentials including a person’s educational background, vaccination records, and medical certifications, Greaves said that blockchain data ledgers may be used to confirm a person’s identification.
According to Victor Mapunga, who founded FlexID, a Zimbabwean business supported by the Algorand Foundation, its goal is to offer identification proof to the 400 million people in Africa who lack official identification.
A decentralized approach using blockchain would be “fundamental” in resolving Africa’s issues with identification verification, according to Mapunga. “You can’t verify credentials about individuals in a centralized fashion because it’s very hard to trust the origin of those credentials, it creates a central point of failure, and it makes it very hard to scale,” he said.Share & like