There are over 7,000 cryptocurrencies in the world and just a few dozen in Africa. And yet very few of them are actually used. Among the most promising projects is AFRO, a cryptocurrency launched in 2018 that addresses the Senegalese artist’s Mansour Sy Kanakassy’s idea. AFRO aims to be a pan-African cryptocurrency and in the service of development. Some countries have already adopted it for specific uses
They are about fifteen economists, businessmen, experts and artists, and they are convinced that Africa is a country of the future for cryptocurrencies. In 2018, they created AFRO, which is now managed by a foundation. The idea is simple, while the continent has more than forty different currencies, a single cryptocurrency can facilitate exchanges and in particular make them cheaper by removing exchange fees. Economist
“We found that there were several national currencies in Africa and that there were difficulties in trade. You have a significant exchange cost and you also have logistical problems. To help solve these problems, it is conceivable to use a single currency in particular, which would contribute to integration by facilitating trade between countries, explains Daniel Ouedraogo, one of the founders of AFRO.
Another advantage is that the African diaspora would lose less money by using AFRO in its transactions. Because it does not cost anything to send a cryptocurrency to a correspondent in Africa unlike the services offered by money transfer companies. However, it remains to convince African governments to use this cryptocurrency, and that is what the foundation’s members have been doing for three years. With, for example, a completely new service offered since last week by the Ivorian post office.
The ambition to be adopted by the states of the continent
“At the Ivory Coast post office, you have a tab where you can send electronic registered letters. And the proof of the official correspondence exchange, that is, the proof from the sender of the recipient and the content of the correspondence is archived in the AFRO blockchain. So that AFRO is not only used as a means of payment but also as a repertoire for the event, explains David Nataf, who is also one of the founders of AFRO.
The strategy for the initiators of AFRO is to offer their services on an ad hoc basis, country by country. But the ultimate ambition is much greater. “We have the ambition to be adopted by the continent’s states in order to form a common currency. What is important to clarify is that at the governance level we are open to shared governance. The founders of AFRO do not want to remain responsible for or control the currency,” continues David Nataf.
To become the only African cryptocurrency, the AFRO must become what is known as a “stablecoin”, a stable currency, ie linked to a currency, in order to limit its fluctuations and thus the risks of exchange. For this, the AFRO Foundation is setting up a compensation fund. A long and complex process, but one that is beginning to arouse the interests of some African central banks.
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