Kenya IGF Online Discussions. Day 3. Developments in Fintech and E-commerce

Agreed with Hillary,
One can find use for Distributed Ledger (DL) Tech without the Crypto aspect. The core advantage of DL within the Kenyan context is distributed control – as in the decision (consensus) on what is finally entered as a true record of events is shared and NOT under one entity(node).
Think about our notorious election process where Chebukati and Chiloba (IEBC) retain the final say.  If we moved our electoral system onto a blockchain or a distributed ledger, the history of all voting transactions would be algorithmically determined by the participating nodes from say from IEBC, Judiciary, Political Parties, Civil Society, Professional bodies and others to be determined (by a changed law).
The blockchain properties of immutability, transparency, auditability, provenance, etc would then all come into play.  Infact there would be no more #Fungua_Server manenos.
All these without Cryptos.
That said, Cryptos or Tokens also have their place.  One can remodel the whole economic system around cryptos or Tokens.
For example, one could incentivise positive behaviour around certain resources by awarding or deducting tokens. For example if we want to keep Nairobi clean, we could have residents earning ‘Green-Tokens’ for each positive action they make for reducing pollution, while those increasing pollution would have their ‘Green-Tokens’ deducted. 
Basically we decentralise and Tokenise the NEMA function 🙂
In short, DL & Cryptos/Tokens can work independently or together.
On Tuesday, July 17, 2018, 10:22:29 AM GMT+3, Hillary Cheserek via kictanet <> wrote:

Hi John, Just a clarification. A distributed Ledger is a set of nodes distributed geographically and operating independently using an agreed protocol. The protocol is designed to verify certain data and ensure that it is synchronized. Blockchain is one form of a distributed Ledger that utilizes either proof of work or Proof of stake. Bitcoin for instance utilizes the proof of work protocol and nodes compete to solve a complex puzzle by hashing the previous block in the current transaction. Proof of stake means you have more voting power based on how much you have and it is believed that you cannot compromise the network because you have a stake in it. Please note also that Cryptocurrency is the product of  some Distributed Ledger systems as an incentive for the independent members to run the nodes. It is possible to run a distributed system without Cryptocurrency in a controlled environment or with certain contracts. There are protocols like hyperledger and Hashgraph which examples of distributed ledger protocols outside of the crypto world. They can be used in the supply chain world to link regulators and manufacturers. The opportunity in DLT is so huge. It is limitless. 

On Mon, Jul 16, 2018 at 3:42 PM, mauxdatabase via kictanet <> wrote:

Hi Ali,
The problem is definitions have gotten muddled up by the wave(s) of blockchain hype.
The original definition of Blockchain contains these key components are married to each other.
– Protocol; Consensus rules for how Blockchains/Crypto-currencies work. Enforced by primarily 2 methods proof-of-work and proof-of-stake. 

– Distributed Legder; This is usually confused with the Blockchain. This is the collection of blocks sequentially linked(Chain) of processed transactions.

– Currency; This the reward token paid to miners/stakers who process the transactions, create the blocks and chain them together using the rules defined in the protocol.

– Software; This is open-source for verification and is why we trust the above. The Software can be optimized continously but usually the protocol is more rigid;

So to answer your question; the Distributed Ledger without the other components is not really useful, in-fact databases are much more efficient.


John K

On Sat, Jul 14, 2018 at 10:40 AM, Admin CampusCiti via kictanet < > wrote:

Great conversations.
I particularly like the angle of sovereignty brought out by Rosemary. However as we navigate this space we need to be careful not to put ourselves in an island and ‘Balkanize ‘ the BlockChain. 
@John, the whole aspect of BlockChain is decentralized and the tokenization model is intrinsic to its value proposition. I’lol be keen to understand how that would work without tokenization. Happy to discuss this point.
On innovation and funding of startups in Africa there’s been an alleged bias towards ‘foreigners’. My take on that is that those allegations are too simplistic. As a country and continent we MUST fund our own startups and not wait for ‘handouts’ from the West. Money is racist, tribal and parochial. It is what it is. 
Ali Hussein
+254 0713 601113 

Twitter: @AliHKassim

Skype: abu-jomo

LinkedIn: http://ke.linkedin.c om/in/alihkassim


“Discovery consists in seeing what everyone else has seen and thinking what no one else has thought”.  ~ Albert Szent-Györgyi
Sent from my iPad
On 13 Jul 2018, at 8:17 PM, carolyne mimano via kictanet < > wrote:

Actually cryptocurrencies are enabled by blockchain technology.Blockchain being the underlying technology it can run independently of cryptocurrency.And a lot of blockchain technologies actually do not involve cryptocurrencies.Blockchain has also developed into other more recent technologies such as ethereum and has been successful.Just like the example of Safaricom which just recently relocated its data centre from Europe-Germany to Kenya a lot of our blockchain use will be internationally located until the technology and expertise is vast.
On Fri, 13 Jul 2018, 8:03 pm mauxdatabase via kictanet, < > wrote:

Rosemary, on Blockchain, you bring up very important points to consider;
I am yet to see any successful and publicly verifiable use of Blockchain(Distributed Ledger) without the aspect of the Crypto-Token; the 2 go hand in hand.
Since blockchains are global in nature, its not really a matter of sovereignty in my opinion, but the presence of skilled expertise within ones borders or organizations is key to maintain a competitive edge.
Blockchain programmers are currently very expensive to train; which makes Building and Deploying Blockchain Applications expensive and not easily in our reach.
Thus the Asians, Americans and Europeans are racing to scope up this talent and own the space with their respective Blockchain implementations.
We must do the same, as the future Internet will be tokenized;
In my opinion some of this has to do with policy and rest is building focused dev communities that tap into Blockchain for various use-cases( Title Deed Verification etc).
Thankfully Kenya already has a budding community; but it needs mentorship and capital to thrive!!! Again progressive policies can help here….
My 2 cryptos.
John K.

On Fri, Jul 13, 2018 at 5:40 PM, Rosemary Koech-Kimwatu via kictanet < > wrote:

Dear Listers, 
Allow me  to respond to questions 1 & 4.
1. We must not apologize for the speed with which we are moving. Innovation is our locally developed solution for our local challenges and we have been successful so far. That said, it is important for us to be introspective and to address the challenges, some of which have been covered in this thread so far. Light regulation will create the most conducive environment for innovation to thrive.
2. Blockchain has been quite the buzzword and most enthusiasts can recite potential use cases. The truth however that it is still a fairly nascent technology and we have just began to explore it’s  possibilities. From a policy perspective, there will need to be a purposeful interrogation of the the interplay between the tokens/cryptos the blockchain platforms that come with it especially in public service use cases. Should we then develop our own blockchain platforms whose tokens and management including mining  will have an element of sovereignty? 
Kind regards, 
On Fri, Jul 13, 2018 at 12:31 PM, Ali Hussein via kictanet < > wrote:

Good people
Good conversations.  Keep them coming. There are some questions addressed to me and I will endeavour to respond to them at some point today. 
Thank you all!



AHK & Associates


Tel: +254 713 601113

Twitter: @AliHKassim

Skype: abu-jomo

LinkedIn: kassim

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Nairobi, Kenya.

Any information of a personal nature expressed in this email are purely mine and do not necessarily reflect the official positions of the organizations that I work with.
On Fri, Jul 13, 2018 at 10:46 AM, WANGARI KABIRU via kictanet < > wrote:

” The solution (innovation) is what we most clearly see and what gets us most excited. But our stakeholders don’t necessarily see what we see. More important, their goals are different. They don’t care about our solution but rather about a business model story that promises them a return on their investment within a set time frame.” – Ash Maurya

Traction, traction, traction…@Barrack, your Wakanda should to know the above by now.

Be blessed.Regards/Wangari—
Pray God Bless. 2013Wangari circa – “Being of the Light, We are Restored Through Faith in Mind, Body and Spirit; We Manifest The Kingdom of God on Earth”.

On Friday, 13 July 2018, 10:10:25 GMT+3, Barrack Otieno via kictanet < > wrote:

Dear Carolyne,

Many thanks for your insightful responses. Is there any capital flight
or would you say the funds are wholly invested locally?

Best Regards

On 7/13/18, carolyne mimano <> wrote:
> Hi Barrack,
> Having worked first hand in tech startups and innovation i can tell you
> that a lot of the investors are interested in international cofounders as
> oppossed to local.Mainly because we do not invest in our own.A lot of
> cofounders who get funding are those who leave silicon valley for
> Nigeria,Kenya and south Africa.Unfortunately we still prefer to invest in
> property -land etc as compared to research and innovation which is one of
> the reasons why a huge chunk of tech is foreign led.
> Research on tech and innovation should start with the younger
> generation.Note people like Mark Zuckerberg had programming tutors in
> middle school.
> Nairobi Innovation week is just a meeting place for tech enthusiasts,
> investors and startups looking for funding.A lot of work needs to happen
> all year round behind the scenes.
> And yes the government needs to invest more in research as well as we(the
> community) investing more in growing the next generation of innovators.
> kind regards
> Carolyne
> On Fri, 13 Jul 2018, 9:23 am Barrack Otieno via kictanet, <
>> wrote:
>> Hi Ali,
>> 1. We have made many gains in the Fintech and E-Commerce space due to
>> a conducive Policy environment. I am curious to understand why our
>> market is attracting a lot of venture capital. Is it that we are
>> innovative or do we offer cheap labor?, is there any capital flight
>> associated with the Venture Capital that is being channeled into our
>> market. I ask this considering the long debate about who invented and
>> owned MPESA. It eventually turned out that after all it was not a
>> Kenyan.
>> 2. How much is the Kenyan Government through the parent Ministry of
>> Information and Communications Technology pumping into the FINTECH and
>> Innovation Space. Better still do we have any Research and Development
>> fund to support the sector beyond the Nairobi Innovation Week. I
>> appreciate the fact that we have a CS who is at the fore front of
>> Innovation but are we matching the same with the kind of budget being
>> allocated to the Standard Gauge Railway?
>> 3. I would also like to find out from listers that might be in the
>> know , how many Kenyans have access to mobile money and gaps if any
>> that might exist. Is there any research that has been done that is
>> showing the current status of the Fintech and e-commerce eco-system.
>> asking for Wakanda
>> On 7/12/18, Ali Hussein via kictanet < >
>> wrote:
>> > Dear listers.
>> >
>> > Since the advent of Mpesa, Kenya has been recognized as Ground Zero for
>> > Mobile Money/Payments Innovation the world over. According to a World
>> Bank
>> > report one in every ten human beings regularly using mobile money is a
>> > a
>> > Kenyan.
>> >
>> > Over the last few years Fintech (Financial Technology) has become all
>> > the
>> > rage. American startups are setting up in Kenya. The more common ones
>> that
>> > we know are Branch and Tala who combined have raised over $150m of
>> venture
>> > funds in the last few years. These two are mainly mobile lending
>> platforms.
>> > Insuretech is taking root. Payment Platforms are proliferating. Banks
>> > are
>> > jumping onto the Fintech Bandwagon with mainstream banks like Barclays
>> and
>> > HF Group launching their mobile lending apps. Equity Bank boldly
>> announced a
>> > few weeks ago that they are building an API Bank. Banking as a Service
>> as it
>> > were.
>> >
>> > Not to be left out, Blockchain and it’s offspring, Bitcoin is threading
>> to
>> > complete the upheavals in the financial sector. On top of it all the
>> > government is playing catch up on regulation with the announcement of
>> > the
>> > Finance Bill 2018. See analysis from KPMG on this.
>> >
>> >
>> me/insights/2018/06/finance-bi ll-2018-analysis.html
>> >
>> > To ponder:-
>> >
>> > 1. Are we moving too fast? Is there a need to take a chill pill and
>> reflect
>> > on the gains and achievements of the sector?  Should we regulate
>> > lightly
>> or
>> > heavily?
>> >
>> > 2. Should we regulate and cap the mobile lending platforms? Are they
>> playing
>> > a crucial role of financial inclusion or are they just loan sharks on
>> > steroids?
>> >
>> > 3. How about the Credit Reference Bureaus? Are they stuck in a time
>> > warp
>> or
>> > is the legislation in place encumbering them from innovation?
>> >
>> > 4.  Lastly is the BlockChain conversation being overhyped? And how do
>> > you
>> > separate the technology from the cryptocurrencies it spawns?
>> >
>> > Over to you Listers.
>> >
>> > Ali Hussein
>> > Principal
>> > AHK & Associates
>> > +254 0713 601113
>> >
>> > Twitter: @AliHKassim
>> > Skype: abu-jomo
>> > LinkedIn: kassim
>> >
>> > “We are what we repeatedly do. Excellence, therefore, is not an act but
>> > a
>> > habit.”  ~ Aristotle
>> >
>> >
>> > Sent from my iPad
>> —
>> Barrack O. Otieno
>> +254721325277
>> +254733206359
>> Skype: barrack.otieno
>> PGP ID: 0x2611D86A
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