Virtual currency, a new technology that is attractive, but also raises fears within the financial sector. While many countries are hesitant to introduce crypto-currency into their financial systems, Kenya has decided to swim against the tide…
In one of our previous posts, From Bitcoin to Nurucoin, Kenya specializes in cryptocurrencies, we reported on Kenya’s infatuation with bitcoin. A craze that translates into an ambition to further develop the virtual currency. If, today, the virtual currency seduces, it is still feared by many financial actors in the world.
Kenya, on the other hand, has a divergent view on the subject and is keen to discover the full extent of the virtual currency and what it can bring to the national financial system. Last year, the Kenyan government became the first country in the world to launch a mobile payment bond system (editor’s note: a bond is a debt issued by a private company, a public corporation or a government to finance itself with investors). Now, a Kenyan fintech is preparing to issue crypto-currency bonds.
Fintech 4G Capital sees the future of crypto-currency in a big way!
Behind the crypto-currency bond issue is 4G Capital, a Nairobi-based fintech specializing in microfinance and training. The head of 4G Capital is a Briton, Wayne Hennessy-Barrett, who previously worked in the field of intelligence and strategy consulting. It was in 2015 that he set down his luggage in Nairobi, which was then in the midst of a tech boom.
According to information released by the Financial Times, this fintech is currently finalizing a plan to issue crypto-currency bonds mainly dedicated to startups, specifically small and medium-sized companies. The finalization of this project is motivated by the desire to see small businesses develop their funds, but also by the high cost of capital in Kenya, the reluctance of the country’s banks to lend money and, above all, the distrust fostered by the law, which caps borrowing and lending rates while bonds are even more expensive.
The project, which is scheduled to launch in April and issue crypto-currency bonds will take place on a platform run by Canadian technology company Finhaven. Returns will be paid monthly in crypto-currency, bitcoin, ethereum or even US dollars. 4G Capital’s goal is to reach $10 million and a targeted 10% cryptocurrency coupon to prove the viability of the concept.
Between seduction and fear, crypto-currency divides!
As mentioned earlier, the use of crypto-currency is surrounded by differing opinions. Some players in the financial system are attracted to this new technology, but others are wary of it. A topic that is being debated around the world, as bitcoin dipped below $8,000 on Thursday, March 15, for the first time since mid-February. And while there is a lot of excitement in Kenya about the subject, there are a few caveats.
The downside of this technology is still unknown, only time will tell if using virtual currency is more secure or the opposite. The benefits and full scope of using virtual currencies (bitcoin, ether, ripple, among others) will unfold as interested parties research the subject! Who knows, maybe one day the whole world will use only virtual money…?
