Between 2013 and 2016, it is estimated that more than half a million Africans immigrated to EU countries, with the most coming from Eritrea, about 100,000, while Nigeria had the second most asylum seekers, with around 80,000. Somalia was third with about 60,000, followed by Gambia 40,000, Mali and Algeria with 30,000 each, Sudan, DR Congo, Guinea and Senegal with more than 20,000. There are many more undocumented cases.

Austrian Military Intelligence, among many others, have predicted a future sharp rise in unemployment across Africa, which would lead to millions of economic migrants traveling to Europe in search of work between now and 2020, with some saying as many as 15 million African migrants are expected to travel to Europe by 2020.

Most of those who make it to Europe will eventually be judged as economic migrants, not refugees. It is often not possible to send them to their home countries, as their governments often refuse to accept them. Most end up staying in Europe despite being denied asylum. Often times they are caught entering or living in other EU nations and are simply held in jail or deportation facilities until they are sent back to Italy, where they usually first entered the EU.

Most of the migrants from Africa are young, male economy migrants. The average age in many of these African countries range from mid to late teens. With such pervasive unemployment and future prospects looking even bleaker in many regions, the only option many young men have is to make the long trek to their dream-like ideal of Europe to try and find work to send money home to their families.

This and other forms of remittance accounted for more than 2.6% of Africa’s GDP in 2010 alone. This percentage only accounts for trackable amounts. Due to so many economic migrants sending money in a variety of ways and the poor to nonexistent data available, it is estimated to be a much larger number than this percentage. Given the increasing number of African migrants since 2010, in addition to the projected increase of migrants from Africa in the next few years, it is no surprise that sending money is sharply rising to cover a larger and larger GDP of the continent of Africa.

Sending money however, can be tricky. Since most of these young men are classified as economic migrants and not refugees, it is very hard for them to open a bank account in Europe, and many of their families in Africa don’t have a bank account either. To send money they need to use services such as Western Union or Money Gram. These services charge large fees on the transfer of money, with the average rate to most African nations being from 10 to 15 percent and they require a valid form of photo ID, usually a passport. In the other direction, many Africans wish to buy goods from Europe, especially cars, computers, and industrial tools for import. Funds are often required to be converted into Dollars from the local currency before they can be converted into Euro, with additional fees applying to this conversion chain. Many of the migrants in Europe themselves wish to export European goods to their home countries, which sell at a higher premium. However the transfer of funds in both directions can hinder this prospect.

Instead blockchain based cryptocurrencies, such as Bitcoin, could be used to facilitate the transfer in both directions. Both migrants and their counterparts in Africa can buy and sell cryptocurrencies, enabling much cheaper, faster, and even safer financial transfers, decentralized from banking and money transfer services. Once cryptocurrencies become more popular in parts of Africa, they can be sold in shops most likely that also sell prepaid phone cards, using the same business model. In addition, these phone shops could also use the cryptocurrency themselves to order goods such as more prepaid cards. With increasing internet access and services that allow for MMS-based cryptocurrency transfers, this could enable many parts of Africa that are nearly unbankable, such as in roughly 75% of sub-Saharan African, according to World Bank estimates, to gain more economic opportunities. Many Africans have very little trust in the local currency or banking system where there are often overreaching controls and stability issues. Money transfers using bank transfers or PayPal can take days to go through. However cryptocurrencies could be used by Africans to create their own ad-hoc decentralized economies that have faster, easier access to the global economy. Instead of this being a one-way economy of migrants sending money home, it could be used as an open economic system to once again purchase goods and services that Europe or even other economies have to offer. This gives an economic onramp to many regions that need it the most, without any charity or aid necessary. This could be built independently, by the people themselves out of need, with little to no infrastructure requirements.

Bitcoin currently costs more to buy in many parts of Africa on local exchanges, costing between 5% and 100% more than exchanges on other continents. This shows a demand, enough to pay a premium price for bitcoin. Most bitcoin is usually purchased through other international exchanges before being resold in Africa on local exchanges, which can account for as much as 6% of the marked up price. However there are several options to get cryptocurrencies to Africa through the entrepreneurial spirit of economic migrants to be used by local economies.

The trader, A, can invest in their own miners, buy cryptocurrency on exchanges in Europe, or buy for cash/credit/debit in local/private exchanges. Each have their own pros and cons. A meets up with B, the sender, who both reside in Europe, for the purpose of transferring money for little to no fees. A sends the cryptocurrency to C while C gives money in fiat currency or otherwise to D, upon success the confirmation is sent to B that D has the money which means A and B can conclude their transaction. No fee is needed to be charged for conversion from C to D. A can use the cash from B to buy more cryptocurrency for the next transaction. No trust is needed between the parties. This can all take place in the span of about 20 minutes or less. Person C sells cryptocurrency as either cryptocurrency cards, trades them on an African exchange for the current price or buys other goods online (such as debit cards, prepaid phone cards, cars, computers, tools, etc.). On the sale of the cryptocurrency, a fee could be charged in addition to the slightly marked up price due to demand. The fee could be based on volume. Consumers can trade their local goods, services, and currency directly for cryptocurrency, avoiding banking, high transfer fees, instability, robbery, etc. which can then be used to buy goods in other countries, or used as a local currency using their mobile phones with QR codes. No internet is needed when an MMS service is used.





Interviews & Conclusions

I spent three weeks interviewing and discussing these issues with 11 African migrants in Germany. Most of them were in the deportation process to be sent back to Italy, where they have very little prospects.

What started off as an interview regarding their individual economic challenges and their understanding of cryptocurrency quickly turned into discussions and training sessions on cryptocurrencies. I have personally never seen such quick adoption and passion for cryptocurrency. In all honesty, I underestimated their previous knowledge of cryptocurrencies. They were almost all aware of bitcoin, one of the young men from Gao, Mali was even already looking to buy some. Another man from northern Nigeria had already been very active in importing goods to Nigeria such as cars, computers, tools to dig wells, and even a lorry, from both Europe and China in addition to sending money to family and friends in Africa while trying to avoid the high transaction fees. He also had a keen interest in using bitcoin, especially since he was being deported back to Nigeria.

This idea of economic migrants using blockchain architecture to funnel cryptocurrencies to their local economies quickly sprang from those interviews. The migrants I interviewed are very open to new and innovative solutions to their personal economic issues which stem from a much larger economic crisis. In looking for a better model to their own economic problems, they could in turn solve greater economic problems on the continent of Africa. And most importantly, these problems will be solved by the people themselves, instead of external organizations or governments.





This is just one article of many out there on how technology in the broader since of the word can be used by both individuals and companies to positively change the world through disruption by trying to answer the question "How does one build a meaningful life in the age of technological disruption?". #MIGlobal

A special word of thanks to those African migrants I interviewed, their family, and friends for showing me the open-minded and innovative side of Africa and how Africans will solve their own problems through their entrepreneurial spirit.

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