Crypto resurfacing
In the year of 2020 when Covid-19 was beginning and the world was moving into lock down, people were out of work. In every country across the world industries at mass scales were laying off workers at a never before seen rate. Families and people were left with only their savings and their hope it will end soon and maybe an alternative form of income will show itself.
Then in the later half of 2020 the world experienced a crypto boom. To be specific the world experienced a massive BITCOIN boom. This is when bitcoin reached one of its highest prices ever of 26,000 USD per coin. A massive leap considering in the summer of 2010 one Bitcoin was worth 0.05 USD, according to Kai Sedgwick from news.bitcoin.com .The reason for this jump is simple. People’s revenue streams were closing at an accelerated rate, too fast for some to prepare for. People needed a new stream of revenue from a market that seemed promising, that seemed almost too good to be true. This is where Bitcoin enters. People bet their life savings, sold shares to buy it and even borrowed money from licit and illicit entities just to have a moonshot at crypto wealth. That is why so many different bitcoin and crypto platforms came out in western countries and in Asia. The boom presented a funny situation though, regardless of who made money off the boom or who lost, it was Asia, Europe, North America, South America, Australia who had the biggest stakes. All continents except Africa.
Africa, too poor for crypto?
YES. The answer to the question above is yes. African countries, except for a select few at this time, have no hat in the ring for crypto purely because the vast majority of African countries are impoverished. Many for different reasons others for the same reasons, does not matter. Broke is broke. No matter how you got broke you are still broke at the end of the day.
Relative to the population of the continent and in comparison to the other continents, the African continent has the lowest household disposable income. This is not just common knowledge for Africans but backed by the study done by Christoph Lakner in 2013 under the title “How do African incomes compare to the rest of the world?” for the Centre for the Study of African Economies (CSAE).
When already living in countries where it is tough to make money day to day, expendable income for luxuries is vigorously sought for and does not come easily. As such when it is attained it is carefully calculated and spent on necessities and solemnly on luxuries. A lot of western people saw crypto and by extension web3 space as a way to make expendable income to buy luxuries and even then the return on investment was initially sporadic, uncertain and given to chance. To go to a person in a third world country, in Africa, and to tell them they need to spend their rare very hard worked for extra bit of money on a currency that no one can see, that is in a virtual system, that return on investment is occasional at best and that they have a extremely rare chance at any sort of profit. That is something that is not viable for them. At all. At the time of the 2020 crypto boom in Africa you would have been scorned, ridiculed and bullied for even having the notion that it was a viable way to make money.
Crypto being such an elusive concept to most poorer people, the subject would not be given the time to be learnt properly by most people. To add to that, Africans did not get involved due to seeing the fallout of people’s profits in the western world. They continuously lost large sums of money from these cryptos. The icing on the cake to this mass economic fallout was made worse by the now infamous brothers known as Ameer and Raees Cajee. The Cajee brothers both being from South Africa started the Fintech company called AfriCrypt in 2020. A bitcoin buying platform. At the time they were hailed as innovative and credited with “bringing financial freedom to Africa” by having an African founded company allowing Africans to finally buy crypto and opening the Web3 space to Africa. The celebrations soon turned sour. In April of 2021 the brothers stole all the bitcoin from their company by emptying out all of its users wallets, including that of the investors. 3.2 Billion dollars worth of bitcoin was stolen at that time. The brothers have still not been caught. The company initially gave hope to Africans but after it ended it left a cruel, bitter and unwanted taste of the crypto world in a lot of potential Africans considering using crypto or any blockchain, web3 technology. But then how long can this bitterness last? Will there be another company even better than Africrypt? Will Africans resist the future of Web3 just because of that bad experience?
(left is Ameer Cajee and right is Raees Cajee)
The entry of YellowCard
(YellowCards Nigerian team with the YellowCard COO in the center)
The bitterness people felt because of the Cajee brothers incident did not last long. There is a company better than AfriCrypt, and it is YellowCard. YellowCard is simply a cryptocurrency buying platform. But it is currently Africa’s most prominent crypto exchange platform. It even came out earlier than AfriCrypt. YellowCard’s founding goes back to 2015. YellowCard was founded by Chris Maurice and Justin Pouriox with Chris being the company’s current CEO. Although the company is not founded by Africans this does not mean it cannot be for Africans. Most of their company is African operated and this is increasing gradually as they expand due to the increased funding they have received.
After initially launching in Nigeria they are now in 13 more African countries for a total of 14 in total, this number is most likely soon to increase in the next few years as crypto aspirants throughout the continent are looking for apps like YellowCard and other Decentralised Finance apps to engage with. The countries Yellow Card is available in are almost all of the East African Community (EAC) countries except for Burundi, some of the Southern African Development Countries (SADC), A few of the Economic Community of West Africa countries (ECOWAS), A few of the Economic Community of Central African States (ECCAS) countries as well. Although only inhabiting 14 countries out of the 54 the 14 countries it inhabits almost every region of the continent.
The company has recently attained a 15 million USD grant in series A funding by investors such as Block with CEO being co-founder of Twitter Jack Dorsey, Blockchain.com and CoinBase, just to name a few. All invested into this fintech company to increase YellowCards development, expansion and by extension continued normalisation of the DeFi, fintech and even web3 sphere to Africans. Since the start of Covid-19 in 2020 until now, the time of writing this, YellowCard has disclosed that their user pool has increased at least 30X times than what it previously was before 2020. They have yet to disclose the current daily or monthly user rate to the public but seeing as investors were privy to these fine details and still invested to grant them series A funding, then that is indicative that the user rate is more than satisfactory for their rate of expansion thus more than reasonable for Jack Dorsey’s Block and other investors to invest in.
In the current tech environment of Africa people are increasingly getting involved in different areas of the industry, specifically Web3, Fintech and DeFi. All in hopes to expand their expendable income or even their total income. YellowCard is a service that by design and execution is allowing and promoting this action. This is not to say everyone will profit or everyone will get rich or even that there wont be anyone who loses profit. YellowCard app is only as effective as the person using it.
Even though they did not use excellent platforms like QuickNode to help build their app and scale it, like other tech startup companies have done. They have and are still well on their way to being an African tech powerhouse!