In a bid to address borderless payments and access to cryptocurrencies in West Africa, an online marketplace where residents can buy and sell bitcoin in Nigeria, Tanjalo was launched on October 12, 2017.
According to Bitcoin enthusiasts, Africa has a vast potential market for cryptocurrencies. This is why Tanjalo is taking the challenge by allowing Nigerians to exchange their local Naira for bitcoin. The firm intends to add more digital currency alternatives over time. However, it would be recalled that a few months ago, the Deputy Director/Head, Payments System Policy and Oversight, CBN, Musa Jimoh, at a Cryptocurrency conference which took place in Lagos said that “the Central Bank of Nigeria cannot stop the tide of waves generated by the blockchain technology and its derivatives. Currently, we have taken measures to create four departments in the institution that are looking forward to harmonising the white paper on Cryptocurrency.”
Vice also revealed that the Bitcoin’s growing adoption in Nigeria has parallels with the situation in countries like Venezuela, where some citizens have turned to bitcoin as an alternative means of transacting online in the face of massive inflation and perceived financial mismanagement by the government.
In view of the launch and recent developments surrounding the use of bitcoin, Ventures Africa had an interview with 35-year-old software developer, Tim Akinbo, Tanjalo’s CTO and Co-founder of Tanjalo, whose interest in bitcoin stems from the gaps in African Financial ecosystem. Tim owns the only Bitcoin nodes in almost all of West and Central Africa. In this interview, Tim sheds more light on Bitcoin, blockchain and why Nigerians should care about blockchain technology.
Ventures Africa(VA): Can you tell us more about blockchain?
Tim Akinbo (TA): Blockchain is a transparent, publicly accessible ledger, that allows us to securely transfer the ownership of units of value. The technology uses decentralized consensus to maintain the network, which means it is not centrally controlled by a bank, corporation, or government – it is simply ‘unseizable’. In fact, the larger the network grows and becomes increasingly decentralized, the more secure it becomes.
VA: Is there any difference between cryptocurrencies, blockchain and bitcoin?
TA: The blockchain is the underlying technology of bitcoin and other cryptocurrencies. Bitcoin is based on blockchain technology. But bitcoin is not the only application of blockchain. Ethereum is another. Beyond the ether digital currency, which is now the second most valuable with $30 billion of coins in circulation, ethereum supports many other uses, such as smart contracts.
VA: Why do people need to pay attention to blockchain technology?
TA: I think there are three broad forces that make the blockchain and bitcoin in particular unstoppable:
- Active user transactions increase: the rate of new active unique wallet addresses is compounding at an astronomical rate which clearly shows people are becoming more comfortable and finding new and exciting use cases for buying, selling, holding cryptocurrencies or to solve a real-world problem through the promise of smart contracts.
- Currency Crisis: Fiat system is broken and there are good examples from Venezuela to Zimbabwe on how people have lost their entire life savings and generational wealth through the hyperinflationary conditions of storing their wealth in the local currencies. Bitcoin, for example, is already in the top 30 of global Money Supply System in the world and now provides an incredible alternative and hedge to the fiat system.
- Store of value: Institutional Funding is now moving into cryptocurrencies and Hedge Funds and Family Offices, for example, are now putting aside a small portion of their portion to invest in this digital asset class. This will only continue.
VA: How will blockchain technology change the financial services industry?
TA: We do believe the blockchain will change all the fundamental aspects of the financial services industry from insurance to banking to asset management. This is already a $200bn industry in terms of market capitalization and it should grow to at least a Trillion Dollar industry within the next 10 years.
VA: Are there other problems that blockchain can help solve? Problems that are not just related to finance?
TA: Banking is only the beginning: there are about 30 big Industries blockchain could transform: payments and money transfers, cybersecurity, education and academia, voting, car leasing and sales, Internet of Things (IOT), Forecasting, Music/Entertainment Rights and Intellectual Property, Ride Sharing, Stock Trading, Real Estate, Insurance, Healthcare, Supply Chain Management, Cloud Storage, Energy Management, Sports Management, Gifts Cards and Loyalty Programs, Government and Public Records, Wills and Inheritance, Retail, Charity, Law Enforcement, Human Resources, Business and Corporate Governance, Credit Histories, 3D Printing/Manufacturing, and Crowdfunding.
VA: What are the benefits and potential problems with investing in a digital asset like blockchain?
TA: I think extraordinary investment opportunities exist in cryptocurrencies today but there are also some inherent risks:
- They are complex: understanding the technology often requires a degree in cryptography and engineering. They’re also complex economically in understanding how to value them. This complexity – in technology, in economics, and in execution, scares off much of the competition.
- They are operationally challenging: There are no established regulations, operational procedures, or accounting standards to deal with investments in cryptocurrency. Best practices for securely storing cryptocurrency are constantly evolving and the storage cannot be delegated. These operational challenges discourage many potential investment managers.
VA: What was your first reaction when you heard about blockchain?
TA: It sounded like a joke and felt like another ‘toy’ out there on initial interaction but overall I came to the realisation that the fascinating elements of the technology could not be ignored. Here is a field that lends itself to finance, cryptography, mathematics, sociology, economics, and politics. There are few fields that have such an intricate mix.
VA: Do you think that blockchain will radically transform the Nigerian Economy?
TA: We do believe the blockchain technology will transform the fundamental aspects of our lives starting with the financial services industry and that is why we started Tanjalo to be at the forefront of this change in Nigeria. We can’t predict the shape or form this will take but we are sure we are at the cusp of something remarkable and it is only a question of time.
VA: What makes Tanjalo different from other blockchain companies in Nigeria or Africa at large?
TA: There are broadly four things:
- Obsession with the customer: we place particular attention to going above and beyond to ensure our customers have a seamless experience using the platform and that we put our customers first in all we do.
- We are a missionary company: Tanjalo is making money go branchless and borderless. Leveraging on cryptocurrencies like Bitcoin, users can send or receive money or pay for things instantly and securely with or without a bank account in Africa.
- Community engagement: we place an incredible premium on our community of developers that are interested in building products and services on the blockchain technology and in expanding the different use cases. We also work very closely with our community of cryptocurrency traders who act as a sounding board with our product development and product management especially on the order-book exchange side of the business.
- World-class team: the team has an extensive track record in investing, trading, and using cryptocurrencies as a medium of exchange. The team is also responsible for the only fully operational bitcoin node in West Africa.
VA: Where do you see Tanjalo in five years?
TA: A truly vertically integrated world-class digital asset company out of Africa with interests in mining, brokerage, and order book exchange of digital assets (cryptocurrencies).