Bitcoin has been cited as the ‘all-conquering economic juggernaut’. As it’s the hardest money ever…
Across Africa, on average people are spending 27 cents to top up their mobile airtime, and they’re using crypto tokens to do it. Of course, this may seem a little strange of many people within the crypto industry, as this currency was created for the movement of large sums of money, not for topping up airtime worth a few cents.
However, South African startup, Wala, has set out to show that there are plenty of different uses of this currency and that it can act as a better payment method than many traditional options available to citizens in African nations.
The CEO of Wala, Tricia Martinez, has said that “We really believe cryptocurrency is what is going to drive a financial revolution in Africa,”. The startup, which has raised $1.2 million selling this ethereum-based currency, is clearly set for great things.
It seems like all of Wala’s hard work is starting to pay off, as Wala is now processing around 6000 daily transactions for more than 50,000 users across South Africa. Of course, the majority of those payments come in at under $1, but even so, this platform is proving highly effective.
What this startup is showing is that not only are micro-transactions from the blockchain a possibility but also that cryptocurrency can be well suited to people living in less developed countries.
Prior to introducing tokens, Wala was processing customer transactions via its smartphone app, but when it became apparent that it was a highly useful means of finance, tokens were introduced. The issue, however, was that local banks are charging higher fees to process these payments, which can make this currency less affordable.
This issue was damaging Wala’s customer base, but luckily Cryptocurrency offered a way out, by offering to facilitate payments via peer-to-peer networks with far lower fees, once again making this payment method affordable for users.
Today, 100,000 merchants across South Africa are offering goods and services through Wala’s platform.
The question is though, how is Wala facilitating these microtransaction on the blockchain?
In the past year, ethereum transaction fees have increased, which has meant microtransactions have become more expensive. However, thanks to the introduction of a technology called Microraiden, Walla has been able to get around those fees, decreasing the price of using this currency.
Microraiden is a smaller version of raiden, a type of tech that is similar to Bitcoin’s network, which moves transactions off chain to increase the scale. Unlike raiden that uses multiple channels and payment hopping, microraiden allows app developers to set up an app channel for receiving payments.
All user payments are then taken via this channel, which helps to cut costs and once again make this currency more affordable for users. There is no transaction fee, as Wala is able to absorb the cost as money raised via token sales and its venture capital investment, making this currency and transaction method suitable for everyone that wants and needs to use it.
Who would have thought that South Africa would be using cryptocurrency to process microtransactions so successfully? It’s incredible what this tech can do.