Kenya has emerged as a potential regional leader in cryptocurrencies trading and the adoption of other blockchain technologies as the World Blockchain Summit kicked off in Nairobi.
The meeting bringing together tech developers and innovators from across the globe for two days showcased various application of blockchain technology as disruptive models of doing business.
Blockchain is a series of ICT technologies mainly in networking, cryptography, software development and data encryption in which information is stored and monitored from several computers called blocks.
The technology, though almost a decade old is faintly understood and often misrepresented to mean trade of digital currencies with the most popular one being Bitcoins.
During the summit, Kenya was identified as a leading light in the use of blockchain technology both by government as well as private sector. This was mainly due to the fact that Kenya is the only country in Africa that has launched a Blockchain and Artificial Intelligence taskforce.
It emerged that the Kenyan government was exploring on the use of the technology in developing foul proof land titling while the National Transport Authority (NTSA) was looking at ways of using blockchain to issue driving licenses.
According to Dr Bitange Ndemo, the chairman of the government taskforce on blockchain technology, several technology revolutions have passed Africa but is hopeful will be adopted despite the technology facing stiff opposition and sceptism from African governments.
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“People will always fight new technology,” he said. “However, if we allow out tech people to innovate and present disruptive technologies that address local needs, governments will come on board,” he said while referring to refusal by many Central Banks in Africa to recognize digital currencies.
Dr Ndemo, one of the strongest advocate of Kentan ICT sector noted that governments should be slow on regulating the industry so as to allow innovation to breed. “When I first presented M-pesa to Central Bank, we were told it is money laundering. It took long before the technology was accepted. If regulation came before we innovated with M-pesa, we would not have mobile money transfer.”
He also observed that banks were the fiercest critics to M-Pesa which they later came to embrace.
The Chairman of Kenya National Chamber of Commerce and Industry (NCCI) Kiprono Kittony observed that there is a verifiable process in which blockchains operate which promises great level of security which is key to any investment.
A case in point, Kittony said is use of both blockchain and artificial intelligence to provide proof of ownership of a product or in customer service. NCCI, he says was involved in a similar project with Safaricom where voice recognition aspect has been added in customer care call-ins.
The use of digital currencies have however likely to be the face of blockchain debate and use in Africa. John Karanja the founder and consulting lead at Bithub Africa, crypto-currencies will likely continue carrying the bulk of interaction with blockchain technology, but eventually other uses will follow.
He observes that with East Africa’s economy characterized by micro purchases and payments popularly known as kadogo economy, digital currencies stands a chance of revolutionizing transactions as it allows payments that are lower than any bank or mobile payments.
Michael Kimani, the chairman of the Blockchain Association of Kenya says the amount of money traded through crypto-currencies is about USD200 million every month which he notes is unregulated. According to him, most Central Banks are not worried much about revenue loss but rather the transaction details which they cannot manage to trace, hence fearing onset of illegal activities like money laundering.