Another fantastic article. In response to the challenges you encountered with Defi on Etherium and Celo, I would recommend you check out the Terra-Luna Defi eco-system. Terra is a top 10 chain on Coingecko by market cap. It's core mission is to make UST (the largest algorithmic stable coin) the most decentralized and useful form of money in the world. Fee's on Terra are super low, and it's Terra station wallet (similar to Metamask is super fast). Terra's anchor protocol is the top savings protocol in Defi with over $5B in TVL and offers a 20% APY on UST deposits. Terra Mirror protocol is equivalent to Synthetics on Etherium, offering tokenized versions of major US stocks. There are a number of other interesting protocols on the Terra blockchain that I would be happy to walk you through if you are interested. Hit me up on twitter if you are interested (@johnkidenda). It's also part of the Cosmos ecosystem and so is connected to all the other chains that have implemented Inter Blockchain Communication. PS. I am also Kenyan so I resonate a lot with where you are coming from in this article. The easiest way to get money onto the Terra eco system is to buy the Luna token on Binance and send it to your Terra Station wallet. Fees should be a few US cents at the most. Asante!
This was a really good write up of general DeFi space. Personally very bullish on the use cases for Africa and other developing markets.
Overcollateralization is a bit of a hurdle as you mentioned but there are many folks working on solutions and as more things move "on-chain" it may be easier to use reputation or real-world assets to back loans (see for example the RWA solar and green energy projects that MakerDAO is looking to fund with DAI loans).
Fees are also a huge issue, at least on ETH. Other chains (Celo, Polygon, Fantom, etc.) have much lower fees and so may be better suited to the market.
There are a number of stablecoins that are being launched that are pegged to other currencies. You can currently get 30-40% APY on GBP, KWY, EUR and others with things like FixedForex and Convex/Curve pools. On Celo there is DuniaPay who launched a cXOF stable tied to CFA.
The use cases abound and for unbanked population without access to credit, savings, or many transfer options, these options could be huge.
The biggest issue now in my opinion is on/off-ramps for Africans. Without the ability to get quickly and easily back to cash or the TradFi system, it will be hard to convince folks to move what little money they may have on-chain. Something like an agent network could solve this problem, but infrastructure for this still needs a lot of work.
Great article, would love to see more thoughts of DeFi and the use cases in Africa.
Another fantastic article. In response to the challenges you encountered with Defi on Etherium and Celo, I would recommend you check out the Terra-Luna Defi eco-system. Terra is a top 10 chain on Coingecko by market cap. It's core mission is to make UST (the largest algorithmic stable coin) the most decentralized and useful form of money in the world. Fee's on Terra are super low, and it's Terra station wallet (similar to Metamask is super fast). Terra's anchor protocol is the top savings protocol in Defi with over $5B in TVL and offers a 20% APY on UST deposits. Terra Mirror protocol is equivalent to Synthetics on Etherium, offering tokenized versions of major US stocks. There are a number of other interesting protocols on the Terra blockchain that I would be happy to walk you through if you are interested. Hit me up on twitter if you are interested (@johnkidenda). It's also part of the Cosmos ecosystem and so is connected to all the other chains that have implemented Inter Blockchain Communication. PS. I am also Kenyan so I resonate a lot with where you are coming from in this article. The easiest way to get money onto the Terra eco system is to buy the Luna token on Binance and send it to your Terra Station wallet. Fees should be a few US cents at the most. Asante!
This was a really good write up of general DeFi space. Personally very bullish on the use cases for Africa and other developing markets.
Overcollateralization is a bit of a hurdle as you mentioned but there are many folks working on solutions and as more things move "on-chain" it may be easier to use reputation or real-world assets to back loans (see for example the RWA solar and green energy projects that MakerDAO is looking to fund with DAI loans).
Fees are also a huge issue, at least on ETH. Other chains (Celo, Polygon, Fantom, etc.) have much lower fees and so may be better suited to the market.
There are a number of stablecoins that are being launched that are pegged to other currencies. You can currently get 30-40% APY on GBP, KWY, EUR and others with things like FixedForex and Convex/Curve pools. On Celo there is DuniaPay who launched a cXOF stable tied to CFA.
The use cases abound and for unbanked population without access to credit, savings, or many transfer options, these options could be huge.
The biggest issue now in my opinion is on/off-ramps for Africans. Without the ability to get quickly and easily back to cash or the TradFi system, it will be hard to convince folks to move what little money they may have on-chain. Something like an agent network could solve this problem, but infrastructure for this still needs a lot of work.
Great article, would love to see more thoughts of DeFi and the use cases in Africa.
Cheers,
@thatRoyce