BTCJam was founded during the tail end of the global financial recession. Having experienced the impact of the recession in Brazil (a BRIC country) and seeing first hand the collapse of the banking system, the founder of BTCJam, Celso Pitta, realized that there needed to be an alternative source of lending. As a currency, bitcoin seemed to be the safest, easiest, cheapest, and most transparent way to achieve lending on an international scale.

The great recession that began in 2007 hit emerging economies like Brazil much harder than developed nations. Many emerging economies have colonial origins and, therefore, are more reliant on commodity prices. When the financial crisis hit its low point in 2008, developing countries were hit the hardest. Many of these countries were reliant on outside aid from the developed world. As international trade dramatically slowed and developed nations tightened their wallets, countries around the world experienced a devastating impact.



With over 50,000 users spanning across 180 countries, it is sometimes difficult to see how individuals at BTCJam are interconnected. On our platform, we have created a truly global peer-to-peer lending site through the power and technology of Bitcoin. The impact of the global recession serves as a reminder that the world is financially and economically intertwined. Borrowers and lenders at BTCJam can easily get bogged down in the micro managing of loan financing. At times, it is good to step back and see the broader picture of what we are accomplishing around the world.

In order to paint a clear picture of the global amalgam of borrowers and lenders, BTCJam has initiated a “Borrower Story” news segment. These stories are intended to weave a sort of “tapestry” of borrowers and show how they are interconnected in our global community. Often, BTCJam borrowers come from areas of the world with poorly functioning banking systems, rampant financial corruption, and lack of basic financial resources. Even in developed countries, borrowers can face many obstacles and red tape while trying to access fairly priced loans.

The BTCJam community members featured in the Borrower Story newsletter are all users who have been active on our website, have a unique story, and have paid back their loans in full. Borrowers at BTCJam take out loans for a variety of reasons. Many use their loans to fund small startup businesses; some have outstanding medical or credit card bills while others might be planning a big wedding for their bride to be. Whatever the reason, BTCJam has enabled micro lending in all corners of the world through the power of Bitcoin.

The first borrower we would like to feature in our news segment is Samuel from Kenya. Samuel lives in a small town close to the port city of Mombasa. With a loan from BTCJam, Samuel has been able to inject funding into his two small business ventures and create more financial stability.

While living in a fairly rural area, Samuel saw a growth opportunity for Internet related businesses. Samuel is a self-described “social entrepreneur” who “engages in small businesses that help low income earners.” Friends of Samuel describe him as “a go getter and a hardworking businessman.” With his loan from BTCJam, Samuel has funded his Internet café. Members of his community can use his business to “apply for jobs, complete tax IDs, connect on social media, and download government pay slips.” According to Samuel, “Kenyans in rural areas have almost no access to banking. Money transfers for food, medicine, or school fees are things that only city dwellers can attain…I like helping people and making good friends so I thought that an Internet café would benefit my town.”

Samuel also runs a metal welding business that provides jobs for the youth while encouraging creativity and innovation. Highly technical jobs like metal welding often require special parts to be ordered, which can become costly. Samuel explains, “My loan has allowed my workman to buy a grinder to quicken his work timelines in delivering customer orders. Previously he has [had] to use a hacksaw to cut metal before welding pieces together.” Samuel’s business has become essential to the community as many people rely on his business to fix metal doors, locks, and other heavy parts.

When asking Samuel why he turned to BTCJam as an alternative to the Kenyan banking system, he stated, “Kenyan banks charge higher interest rates about 20% and demand collateral for people who are informally unemployed like myself.” While Samuel has a bachelor’s degree in finance, he understands that the lending climate in Kenya is not ideal for small business owners. Instead of applying for a loan at a local Kenyan bank, Samuel took his search online. Samuel explains, “I was looking online for an affordable money transfer service. I saw Western Union, Moneygram, and bitcoins. I was a bit more curious to learn about bitcoin and how it worked. That is when I landed on BTCJam.” Samuel adds, “I would have not participated on BTCJam were it not for localbitcoins.com, which offers a liberal marketplace for bitcoins and affordable rates.” Samuel’s 60-day loan was repaid in full and was funded by 17 lenders from 10 different countries.

Loan demand is skyrocketing in African countries because of strong economic expansion. Much of this is spearheaded by China, which sees infrastructure and technology development as key growth areas. China has invested hundreds of billions of dollars in Africa to assure long-term food supplies for their own burgeoning population. This has created an economic boom and the emergence of a new, borrowing, consuming middle class. The World Bank and IMF have initiated major capital projects in Africa like dams and power infrastructure; meanwhile, Bill Gates has spent billions bringing Malaria and other diseases in Africa under control. Fewer sick people means a stronger economy.

Although Kenya has experienced a robust 4-5% GDP growth YoY, the country ranks as one of the least financially and politically transparent nations in the world. Poor government administration, weak property rights, and strict capital controls have prevented Kenya from achieving growth comparable to their neighbors. In Kenya, corruption remains very difficult to investigate and prosecute and as a result has created a sense of mistrust in the banking system. Although this is true, the Nairobi Stock Exchange (NSE) has grown to the 4th largest capital exchange in Africa. Kenya has also joined the East African Community (EAC) organization, a partnership between Kenya, Tanzania, and Uganda. This organization has helped to create a common marketplace in East Africa and is modeled after the European Union.

The instability of the global financial system has created new avenues of affordable online financing. International bitcoin lending has picked up traction in the online community and BTCJam has been central in this financial revolution. Global peer-to-peer lending has enabled people in developing countries to become entrepreneurs and has allowed many of them access to fairly priced loans for the first time in their lives. As we move forward with the Borrower Story news segments, readers will be able to see the diverse undertakings and business ventures of BTCJam users.