Exclusive: Crypto Bootstrap founder on crypto empowering African entrepeneurs

18 Oct, 2018
by Arthur Sillers
Analysis
Exclusive: Crypto Bootstrap founder on crypto empowering African entrepeneurs

Mark Lawrence is the Founder of Crowd Bootstrap, a start up exploring ways to monetize natural resources in Africa- a region which many point to as a potentially explosive region for crypto adoption.

Chepicap, at the Global Blockchain forum earlier this month spoke to a lot of people who are trying to push crypto into a new phase where mass adoption leads to sustained profits, stable value, as well as the use of the power of blockchain technology to improve the conditions who are subject to traditional financial actors and the endemic problems therein. 

Africa is a region with many financial inefficiencies and abuses and there has been sustained interest in the developing world as a target region for crypto adoption, especially in Africa, where many are unbanked, underbanked, or are dealing with banking infrastructures which are woefully lacking. Many have pointed to Africa as a region which could see mass adoption of crypto in order to create a new type of banking infrastructure for a region which desperately needs more stable and accessible payment systems and storage.

Mark Lawrence acknowledges that these problems are use cases that crypto has potential to face, and also spoke of how blockchain could improve financial aid to impoverished African municipalities, but his start up Crowd Bootstrap is using crypto in particular to give agency and economic potential to Africa, starting in the country of Ghana who has partnered with him, by tackling an economic quandry that has been holding African development back- the abundance of natural resources, especially gold, which lie untapped in African countries who would benefit tremendously from the potential profits these natural resources offer, but lack adequate access to start up capital.

Chepicap had a chance to sit down with Mark Lawrence to talk about his effort to use tokenization to help the developing world. Mark notes that many countries in Africa are impoverished despite large stockpiles of precious metals, gold and other resources lying in the ground. The situation in Africa is such that the people have ‘all these natural resources, and literally they’ve got no money to monetize’ meaning there is a lot of potential wealth lying dormant.

The limiting factor right now in turning these resources into capital for a continent which needs it is tremendous operational cost and lack of a robust investment sector, which currently leaves African entrepreneurs with no good options seeking to undertake mining operations.

‘The option they have today, is to go to an international mining organization who come in and say we want to take an 80% majority position. The other option is that they have these illegal miners come in and they have a front-person who is local, but basically they’re just exporting all the wealth to their home country.’ With a problem that comes down to lack of access to capital, and lack of the ability to ensure ownership over investments, revenue, and profits, Africa is a fecund region rife for blockchain adoption.

Using ICO’s to tokenize latent natural resource profits ‘eliminates a lot of the friction,’ and makes it feasible for entrepeneurs to retain control over profitable stockpiles of latent natural resources by turning the profits into shares which it can issue to pay for production and logistical costs.

The blockchain is a good solution because it ‘kind of switched the way we give out funding, in the old days when we wanted to do an IPO, we had to actually build an organization,’ which many don’t have the ability to do without resorting to exploitative foreign mining companies or illegal operations, both of profits to be had significantly from Africa towards other countries, which in both cases tends to deprive the entrepreneurs of ownership of their work, resources, and the profits they generate.

Blockchain thus gives ‘entrepeneurial miners an opportunity to monetize their natural resources,’ which not only is a new kind of use case for crypto, but is ideal for a region which is eager to adopt disruptive technologies.

This is a seperate but related problem to the huge number of unbanked and underbanked people in Africa, which Mark actually points to as evidence that tokenization of natural resources could be so successful there. Mark notes that because of a lack of a developed banking sector, ‘to a certain extent, Africa is ahead of the world in terms of point-to-point transactions,’ going on to describe that in his visits to people are using mobile phone apps to pay for goods and services already, which shows that Africa is not only ready for the introduction of a new digital payment system, but eager to adopt new technologies and investment paradigms.

‘I see the future in terms of leveraging the natural resources because that’s where all the wealth is, but it cannot be tapped using the old technologies, using the old financing methods.’

While the crypto economy will certainly see bolstering from institutional cosigns from Fidelity and other stalwart financial institutions, projects like Crowd Bootstrap utilize crypto in a way close to its original utopian vision, as a way to disrupt the traditional financial world with centralized control and decentralizing it, and improving on the problems endemic to the global financial system which have become entrenched in the world’s economy.

 Read more - Wala is teaming with the Ugandan government to deliver clean energy , Mobile startup ONEm Communications launches hybrid crypto for Africa 

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