Kenyan online workers, PayPal and the UK Government are entangled in a mess that is paving way for Bitcoin and cryptocurrencies
A spat between the UK government, PayPal and Kenya freelancers has got everyone mixing up issues.
“Thousands of jobless graduates from Kenya who help lazy university students in developed countries to cheat academically could soon be forced to find something else to do after the UK government started clamping down on essay mills.
On Thursday, international digital money transfer service, PayPal, announced it was withdrawing its services to essay-writing firms selling to university students. This was after weeks of pressure from the UK government, which insists stopping payments for essay mills would go a long way in beating academic cheating.’ Daily Nation
There are 3 parts to this story.
First, the British Education Secretary, Damian Hinds, says when UK students tap cheap labor in Kenya for their assignments, it is unethical and cheating. 46 university vice chancellors last year wrote to Hinds, calling for the banning of cheating websites.
Secondly, PayPal is caught up in the wrangles for facilitating online payments between UK students and Kenyan freelancers. PayPal has come under pressure to stop processing these payments and declared it will not support unethical academic behaviour by UK graduates. Some people have suggested, cryptocurrency may serve well as an alternative for Kenyan freelancers.
Finally, in Kenya, we are all caught up debating whether it is cheating or job creation, as thousands of graduates are dependent on the thriving business for wages and employment.
This case is a glimpse of tectonic shifts at play on the future of Africa, its youth population and the web economy. It is easy to miss the forest for the trees.
To get at the heart of the matter, we need to go back to 2009 when it all began.
Using blockchain and cryptocurrencies, popular internet platforms, are about to disrupt Mpesa in East Africa, the same way Mpesa disrupted banks.
According to sources, Facebook Is Developing a Cryptocurrency for WhatsApp Transfers known a Facebookcoin. If true, this spells doom for Mpesa and Safaricom as they will soon end up as a commodified dumb pipe, like a utility company resigned to a passive role in the medium to long term future.
Popular internet platforms in East Africa have grown beyond social, and now support value exchange within their closed environments – for example Facebook and whatsapp, both social platforms where people engage in online trade and biashara.
By adding a US dollar pegged coin known as a stablecoin within its virtual network, more value can be captured and retained within the network until it is absolutely necessary to cash out into local currency.
Facebookcoin, platform based currencies and network cryptocurrencies pose a threat to Mpesa just because of the sheer size of the networks they command and everything that goes on within them. This is great news for Fintech startups and banks in East Africa who can reinvent themselves in a post Mpesa world.
Africa’s most popular mobile browser, Opera is about to radically change the payments landscape in Africa.
I think before this blog and thread, the global cryptocurrency community will not appreciate the strategic relevance of Bitmain’s $50 million investment round into one of Africa’s most popular Chinese owned mobile browser, Opera. What they will not see is the Fintech connection at play in East Africa, where the wildly successful mobile browser is creeping into digital financial services like mobile payments. For the payment professionals of East Africa, the pertinence of this investment on the future of their industry will not dawn on them perhaps until it is too late.
Last week’s SEC’s disclosure on Opera’s newest investor for their $115 million IPO, was the best strategic news on cryptocurrency ‘adoption’ in Africa I have seen in the last 5 years with far reaching implications on e-commerce, trade and payments for the region than appears at first glance.
My choice of a header image above accurately captures increasing Chinese influence on Kenya and Africa, at both state and commercial level.