Borderless Africa - a New Narrative by Yoseph Ayele | Devcon Bogotá

foreign [Music] Defcon how's everybody doing today So today we're going to talk about Africa part of the world that we all know but oftentimes overlooked but before we start I want to ask you how many of you here are from Africa awesome how many of you have been to the continent before how many of you have worked with people collaborated invested in how many of you are Africa curious awesome so um we're here to talk about you know a beautiful continent that means a lot to me a little bit about myself I'm from Ethiopia grew up in Kenya and Tanzania lived in Nigeria and when I was growing up the predominant narrative is that you are at the bottom of the pyramid and if you want to do big things in the world you got to leave the best building was the airport the best road was the road to the airport and so I followed that narrative move to the West for about eight years I worked in experimenting with immigration systems to find holes within the Gated world so that we can have a Global Talent base and a borderless vision and then I discovered web3 and where web3 made sense to me was actually through the Africa lens and that's a vision I want to share with you today so the predominant narrative we've been using so far is that African needs crypto right let's Bank down banked that's been the narrative from day one let's pull people out of poverty let's develop I develop a nation let's make a real impact um let's fight corruption and create Financial inclusion and there's a lot of sort of moral based narratives that we've been using so far in all of these make a lot of sense but there's a different narrative I think it's important for us to really explore and that is what if it is actually web free that needs Africa to fulfill its full potential and for the last for the last 10 years plus we've been talking about Mass adoption we've been talking about bringing in a billion people into this space to get people who actually use the technologies that we're building for daily things that people rely on we want web3 to be plan a not plan B and I believe that's where Africa plays a role and that's the narrative that we're going to unpack today but before we do that I want to kind of do a bit of a high level overview um around the demographics and really understand where the continent is right now so let's look at demographics Africa was has 1.4 billion people 70 of us are 75 of us are under 35 the median age is about 19 years old where the youngest population and the fastest growing and also the fastest population that's urbanizing but that's not just the picture the other part of it is that we're growing really really really fast by 2050 we're expected to be almost 2.8 billion people 50 of that population is concentrated in just seven countries and we're going to expect about a third of the world's young people are going to be in Africa just to put that in perspective just in the next 18 years there's going to be twice as many young people in Africa as in China 50 more than in India and three times as many young people in Africa as Europe and the US combined so if we're talking about users if we're talking about Talent base if we're talking about the future Workforce of the world that's going to be in Africa the other bit is around the economy and this is a mixed image here so about 457 million sub-Saharan Africans actually have a bank account and 370 million adults don't there's a lot of statistics around unemployment about a third is considered unemployed but I believe it's a big bigger number than that and we expect about 350 million Africans today are considered middle class and the definition of middle class kind of varies at the moment cost of living is really going up and so um you might be considered middle class but you're not thriving 43 of the population is considered is expected to be middle class by 2030. um but if we look at aggregate numbers there's actually huge amount of capital Africans are spending 6.3 trillion dollars of consumer and business spending expected by 2030 and 4.

2 billion of that is B2B so Africa is not just poor population that the world needs to go save it's population made of people who actually have an ability to create and spend the other part of the narrative like understanding is around technology and this is also very mixed um we have 590 million Africans who have accessed the internet a lot of that is coming from Mobile use and we're expecting six percent mobile adoption year on over year and the other bit is mobile money is huge and that's concentrated in very specific countries so we have 448 million Africans actually registered to use mobile money but only 18 of them are active on a monthly basis we see a huge concentration of that in countries like Kenya where more than 70 percent of the population is using m-pesa and I was quite kind of confused when I found that there's 250 billion dollars being transacted through m-pesa in Kenya but the GDP of the country is only 110 billion so it kind of shows you how the economy is very Dynamic and a little different from how we think about it crypto um we have last last year 105 billion dollars transacted which is a very small amount of the global uh uh total volume transacted it makes about two percent but we're seeing a thousand two hundred percent growth and kucoin expects 2500 growth of users since last year but the interesting bit here is actually the majority of it 88 of the money that's transacted uh is for cross-border transfers and a lot of the transfers are happening at a peer-to-peer level um and under one thousand dollar transaction makes up a huge part of the volume so we're seeing a lot of small retail users getting into crypto there's a new exchange that's launching soon and they haven't even launched it it's been a few months since they put this out but they already have 2.3 million people on the wait list for the download so if you're thinking about volume of people getting into this space there's a lot of that happening in Africa um but the interesting bit is the biggest entry point and the biggest part of the conversation there is speculation and gambling and there are big events bigger events than Defcon that are happening very regularly to get people onboarded but it's primarily around you know trading and just making quick bugs but there's a huge population that's actually curious about what it means to work in this space a couple of weeks ago I met the guy who leads the largest Dev community in Kenya and he said basically his entire committee is really curious about this space but they're trying to figure out what the hell is web free so why are with all of these aspects why is Africa unique from everyone else like why should we think about Africa as the main thing that we're three needs to achieve its full potential and to do that I think we really need to understand why the current Paradigm is not working for Africans if you see the world as a food chain Africa is really at the bottom of that food chain and the current geopolitical economic structures lock the continent in that position and so basically the only option many people have to get out of there to get into this place of emancipation is through web3 let me give you a few examples of why this current Paradigm is not working first we actually don't control our money 40 out of 54 African countries prints the money overseas it is England Germany and France that do most of it and they say six percent of the entire currency that's been printed um as a fee and there are a lot of stories about money being lost in shipments and all of that um that's not only the part of the equation so in 2011 the United Kingdom actually withheld about a billion pounds of money that was supposed to be shipped to Libya for political reasons so once that president has been said you actually don't control your money the other interesting thing that I've been learning is that 14 African countries are part of this thing called the CFA it still stands it's called the French colonies of Africa where they basically created a euro-pegged currency um and in order to use that in parallel with the local currencies they have to deposit 50 percent of their reserves in French treasuries um and what that also means is basically there's been devaluations that have happened and debugging that actually the French government has created as a result of what's happening in Europe and this countries basically don't control their money how many of us have heard of the Central African Republic that made Bitcoin part of a legal tender that was an act of desperation basically saying hey if we don't control our money we have nothing to lose global trade is very expensive and pretty much impossible this huge currency devaluation in many African countries and there's chronic Forex shortage just to give you an example just in Nigeria and Ethiopia in Nigeria there's 500 a month limit of how many dollars you can get out on a monthly basis in Ethiopia you have to sign up on a line and wait up to six months just to get dollars out if you're doing a small business how on Earth can you actually import export do basic things if you don't have access to dollars in trade with the rest of the world that image I took it last week um I was in Lagos Nigeria and I tried to change a hundred dollar bill and that was the stack of uh Nigerian naira that we received and so yeah you're walking around the Bulge pocket um of a lot of dollar bills close to 10 percent uh we pay about 10 Bank fees to transfer any money in and out of the continent and sadly as a continent only 15 percent of our trade is within ourselves the rest is with the rest of the world and that's a lot of like trade issues and all of that and we spent about five to ten billion dollars in Swift fees which is massive and many people are locked out of web to economy because they don't have a credit card when I was in Ethiopia applying for college I had to borrow a credit card from people to actually submit applications and so many people still don't have international credit cards and because of that now the world will not take African money bequil cannot participate in the global economy that way the world is gathered for Africans borders are closed for Africans there's supposed to be so many Builders there was there were planned to be here they couldn't get visas to be here um African passports are the worst in the world to carry around when I was traveling around in my Ethiopian passport I used to wear a big cross on my neck just so that border control doesn't confuse me with the terrorist and you talk to many Africans who are traveling around the world there's this thing called immigrant anxiety that's because for whatever reason doesn't matter who you are what you're doing the world is shut for you many Africans make the bottom of the list in applications job applications and all of that is the least trusted population for employment and Africans make the least money in technology and I'm a little sad to see that also happening in web 3 where dozens of builders that I've been speaking with they're earning about fifteen to forty thousand dollars a year compared to Global counterparts for doing the same work or earning a lot more for the same work so I think that's something we've got to change now there are being small steps to improve this Paradigm there's a pan-african single trade zone that's developing their internal Payment Systems banks are creating in order to reduce dependence on foreign currencies and their cbdc is growing like in naira but these are very small steps now my biggest issue with some of this is that even though we're trying here that we're not the institutions are not really set up to meet the needs of the young people you go and meet a lot of young people they're very hungry they're driven they want to thrive they don't want to just survive they want to have a piece of this world just like the rest of us they want to do real things they want to maximize their creative potential and basically institutions as we know them are not set up to meet that need so what do we do well in order to instead of just trying to fix this Paradigm from within the answer to me is transcending the current paradigm and part of that is building what I believe to be a borderless economy in a borderless society to me what that means is actually emancipation path to self-determination and when I talked to a lot of young people on the continent they say wait a minute you can participate in a global economy no one really cares who you are where you're from you can work you can earn Global income by paying local salary you can collaborate with people from all over the world you can build communities you can own part of the internet you can have part of this space and actually build tools and protocols to build the future economic infrastructure of your continent people's eyes light up because this means freedom this means moving out of the con suppressing infrastructure that we have there so I want to give you a few examples of what this borderless economy could look like one of the areas is Talent I'll give you a few stories and examples of people I've been meeting recently one of them is Ken he's a student at Lagos University the school has been in huge strikes so far and he got into crypto through the blockchain association in the university and then he kind of started figuring the space out in within one year he learned about defy All The Primitives and really started getting involved in a lot of protocols and now he's part of uh top Mira governance Dao and we're collaborating and he's one of the best performers that we have in the Dow and there was no one who held his hand in learning about this whole space from scratch another person is Victor who I met recently as well from Kenya he's an architect and he discovered crypto just speculation and then he said wait a minute if I'm trying to build a career in architecture it's going to take me 20 plus years to even get to somewhere decent what about teaching myself the rails of crypto and then he taught himself solidity on YouTube again without anyone holding his hand and figured his way around a lot of D5 protocols and dials and now he's doing smart contracts um he's working on Smart contract solutions for uh uh a major D5 protocol and he's doing all of that anonymously so no one even knows he's a Kenyan guy there's a lady called Sherry she's a photographer in Kenya as well and she's been struggling to feed herself and look after herself and she discovered nft space she locked herself up in her room learned the whole space in three days started minting nfts using her photography and he's been earning real income and is now building community of bringing other nft artists into this space these are just very few examples and there are so many many more self-taught Africans who are getting themselves into this space working creating participating many of us know African culture all over the world but it's just now that African creators are being able to capture part of the value from the things that they're building another area that's really interesting is trust many African countries are very low trust environments meaning there are no trusted intermediaries so there are very few trusted intermediaries that can actually enable economic and various activities between people and that is actually really critical because here in Western places we talk about um web 3 kind of uh these intermediating our economy right but you go to places like that actually where there are no trusted intermediaries You're Building from the bottom up and to me that means basically um Africa is where decentralization has found the best product Market fit that is where you can actually build a lot of tourist infrastructures from the ground up let's look at Finance we talked about access to Forex right earlier on so actually go to many African countries you can access stable coins a lot easier and faster you can access dollars and so many people are bypassing Banks using stable coins now think about the global remittance industry that is massive and that is really huge and that's where actually we can build borderless finance and really accelerate the growth and development of many communities there the other bit is looking at D5 applications that have been built on top of mobile payments that's a really huge space because access to credit is very very scarce it's a very small number of people who can actually access that the local debt providers charge between 10 to 27 interest a month that's really really Sharky and really terrible so this is the space is huge to transform this area and these are just very few examples and there are so many more ways that this borderless economy bottle of society is manifesting in the continent and we should expect basically more Africans getting to this space in masses to work and build develop and consume so here in web 3 we're talking about how to bring the next billion we need more users and more Builders who rely on it for their daily lives we want this space to be plan a not a plan B when we're sitting in our cushy chairs and kind of comfortable environments where the system is kind of working for us but we want to improve it it's a lot harder to reach Mass adoption but when you're going to places where it's a very low starting point then actually you have huge momentum huge growth huge adoption huge creation that can happen in this environment so there's so many ways to build this and we have a very low starting point what are something on the mountains we can climb in this space there's a lot to do I'll share with you some of the mountains that I feel inspired and motivated to climb first is education and we talk about education in so many ways there's so many protocols and layer ones from the continent talking about education but actually it's marketing to onboard a lot of people to use it let's talk about education starting from a place of values and why is this important well many people and many young people in Africa get into crypto primarily through speculation and they're actually their Learning Journey is determined by the algorithms of Facebook and Twitter and sorry YouTube and Twitter so if you land on some coin Shilling YouTube page everything else you keep learning is going to be very much related to that so it's quite narrow way of entry point and I think this needs to be a lot of work of actually embedding why are we here why is this space actually made for them and we gotta create infrastructures for people to learn to learn as I talked about there are a lot of people getting into the space on their own but how do we really accelerate that to hundreds and millions of people to get into this space and then developing actual core skill sets so that people can come and work in this space that is already happening but I think we can really do a lot to accelerate that space the other one is just having more Founders solving their continence problems and we need so much of that they're local Founders but we need thousands and thousands more Founders and the biggest challenge is Founders need Capital to build and a lot of the capital on the ground is very unsophisticated very few players very short term and their new entrance to this space that are using the buzzwords of the day to basically create short-term wins and I think in order to do this really well we got to think long term and long-term means in this case that many Builders are creating the roads that they're walking on in Western economies a lot of web 3 was able to move very fast because we have web 2 we have something to lean on we have a lot of core infrastructures to build on top of but when you're going to environments where you got to build that infrastructure from the long from from the bottom up you got to think long term and that's actually where you can accrue a lot of value and and build a core economic infrastructures for the continent and the other bit also of uh and funding space is uh supporting Grassroots activities because that's where a lot of the foundation is being created and that's where public goods plays a big role there's so many Grassroots players using the same value system that we have here helping develop the core infrastructures of mass adoption in this space and that's a huge gap on the continent the last bit is building community and I'm talking about Community with the principles and values of community that really matters because there's a lot of sort of extractive community conversation that is happening around the continent which is just trying to get as many people to sign up get big user base get you know large adoption and you know that's fine but if you actually many protocols go there with the spirit of extraction what you end up doing is raising a generation of mercenaries so actually when I got a lot of events and I talked to the people there they're like yeah we know what's going on you like we're playing the game so helping you build the numbers but when there's something better everybody leaves and I think that's a big challenge because people are going not to build community but to create the short-term wins in order to look good and have the numbers raise money inflate tokens and all of that and if you actually want to build community you got to think about how do we increase the sphere and then at the end of that we have a bigger Pie as a result if you start looking at Africans as not just consumers but as producers you are able to untap so much of the potential and be part of their success so that's to me like that's really what feels extremely exciting and if any of these mountains you're finding exciting less Jam if you're thinking about climbing other mountains let's figure out how to support that work and accelerate your journey because at the end of the day I think Africa will have a lot more to contribute to this Webster movement and we're here dreaming thinking building and creating but if we want to actually this infrastructure to be used on a daily basis doesn't matter if it's a bull market or a bear Market if we want this space to be used to actually meet people's needs and people to rely on and to have the space to build on I think Africa is the right answer for me thank you