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Michael Kimani @pesa_africa
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Approximately five days ago, bitcoin miner and ASIC chips creator, Bitmain, invested $50 million in Opera Browser

Let me tell you why i think this matters /thread
One of the best bitcoin cryptocurrency adoption applications/service in Kenya was Bitpesa in 2014

Simple model, exchange your mobile money mpesa o your prepaid wallet into bitcoin. In and out

Mpesa --> Bitcoin
Bitcoin --> Mpesa

Great service! 1/
Kenyans today have never really had the feel of such a service. B/c Bitpesa got shut out from Mpesa platform in December 2015.

Pre 2017, crypto adoption/awareness/buzz was lower compared vs today. Price bubble 2017 roped in more attention

Here is a weekly volume chart chart 2/
Thats a chart from localbitcoins (LBC). A p2p marketplace for buyers and seller to exchange bitcoin for cash/mpesa/bank

After Bitpesa got shut out, volumes on LBC grew.
LBC was the closest 2nd choice thats easy service to use for crypto 3/
I use LBC as a proxy, b/c it has public data. It is not wholly representative, but its a good measure

Link to Bitpesa story… 4/
Bitpesa never took custody of your bitcoin.

All they had was a gateway function for swapping bitcoin to mpesa on a web interfaces. You had to have a wallet by a different service

Bitpesa wasnt an app.
It wasnt smooth.
But you could pay and receive using Mpesa 5/
Thats a big deal here!

the smoother the Mpesa/prepaid wallet to crypto service, the better chance at success by users

B/c thats how remote payments work here for almost everything.

buying Electricity tokens
buying airtime
buying e- value /6
I was surprised too, that China-backed Norwegian browser has over 100 million plus users of the Opera mini browser in Africa. They have nailed down a niche.

Numbers look good 7/
Critics like to point out the numbers are misleading. B/c Opera's numbers for browser come mostly from mobile


Turns out Opera Mini browser uses data compression technique that saves up to 60% of data bundles usage /8
I suspect Opera browser is popular

amngst people moving up the mobile phone ladder. From your first Itel feature phone, before moving up to a web enabled itel phone, the low cost android tecno phone, then later updgrade to an infinix

Dumb phone ------- Smartphone continuum 9/
My first phone was

a nokia 3310
next web enabled phone was a web enabled nokia (i forget the series). I used Opera mini on this phone
next phone was Huawei Android chinese

Ive used several Huawei, Tecno and kicka phones

couple of iphones 10/
I believe Chinese phone manufacturers have moved into the space previously occupied by Nokia

So today, your first phone experience is likely to be a Chinese manufactured phone. And as your grow in your phone experience, you move up the Chinese ranks 11/
This is pretty obvious for anyone who pays attention to biashara in Nairobi/informal sector/trade

tecno/itel/huawei/infinix are hot brands in Kenya right now. SSA too.

@prepaid_africa has tweeted on this trend past 5 years

Relevant links 12/
The Strategic Entry of China’s Transsion into the Vacuum Left by Nokia in Africa… 13/
"Transsion, Tecno’s manufacturer, has two other brands on the market – Itel, and Infinix catering to different price points and consumer segments. What sets the company apart is that they are solely focused on the African continent" 14/
"If you’re outside Africa, you’ve never heard of them before, but a mobile phone brand called Tecno has been painting Kenya blue ever since I started fulltime fieldwork there in late 2011." 15/
"It was in Mombasa that I first noticed the name and wondered what it was about. Over the years, I saw the line up of phones even in the smallest market towns and began wondering if this brand would be the new Nokia of Africa."
"They’ve customized completely for the African market, going as far as to develop cameras suited for local conditions, something no other phone manufacturer has done anywhere on the planet." 17/
"Itel is so popular among traders in the Uganda Kenya borderland due to its low price and long battery life, that our research associate went as far as to capture the mound of Itel packaging seen on the rubbish heap." 18/
This research associate was me. I took this picture.

Biashara people loved itel b/c it had a great battery. Lasted upto 8 days. This sentiment was common across both Uganda and Kenya ie the borderland

It saved on have to charge all the time. Charging costs $$ 19/
Chinese phones ship to Kenya > into Nairobi bustling Central Business District > then ships to rest of Kenya

It seems to me the Chinese grok this market down to the tee 20/
So as an emerging African consumer

Opera browser

saves on data by up to 60%
Likely first browser you come across
on a chinese manufactured phone
First internet experience is on a Chinese phone

Then you move up the Chinese ladder Itel>Huawei>Tecno >Infinix 21/
Now some phone manufacturers and telecom companies pre-install Opera browsers on their devices.

So emerging African consumers move up the ranks in both Chinese phones and the Opera mini browser

I believe these are the 100 million + users quoted 22/
Seduced by Opera Mini, mobile phone subscribers don’t abandon the application when moving app the smartphone market

Also helps that Opera is forming partnerships with operators and manufacturers in order to pre-install its web browser on devices

June 30, 2018

"Opera Ltd filed for an initial public offering with the U.S. Securities and Exchange Commission on Friday.The company, which makes web browsers for mobile phones and PCs, intends to raise up to $115 million in the IPO" via Reuters 24/
July 5

"Bitmain will buy $50 million in shares from Opera Ltd., behind the popular web browser Opera. The subscription agreement ws made public last Friday bt flew under the radar as it was part of a filing with the SEC for an (IPO) to raise $115 million." 25/
Bitmain is notorious for its secrecy, which sets it apart from its other competitors.
Cofounded by @JihanWu 32 year old ex wallstreet banker. Genius. Master strategist Sun Tzu

Bitmain valued at close to $12 billion

Tons of cash! 26/
Bitmain manufacture crypto mining hardware - design, chips, everything. They also run close to 50% of Bitcoin mining power, close to 70% of Bitcoin cash mining power.

Analysts estimated that in 2017 the company generated $3-4 billion in profit. 27/
China’s Bitmain dominates bitcoin mining. Now it wants to cash in on artificial intelligence… 28/
"Bitmain plans to sell these chips to any corporation that wants to train its own neural nets"

i think there's quite possibly a hardware play here with Africa's phone manufacturers 29/
Bitmain also has interests in crypto assets and distribution. close to 70% of Bitcoin cash ( a fork of bitcoin instigated by Jihan) mining powered by Bitmain's Antpool.

Bitmain is an investor in Goldman Sachs-backed cryptocurrency exchange Circle

jihan is cold blooded strategist and Bitmain is expanding its vast empire. Africa is raw with a high presence of Chinese interests all the way from the top political echelons, to the lowly traders on the ground using itel phones

Move over, China's taking over 31/
Lol! All our telecom infrastructure runs on Chinese Huawei manufactured hardware.

I call this the China stack.

From your favorite telecoms mast > to your phone chip > all the way up to your browser 32/
Honestly, i think biggest losers are Europeans and Americans. China has firmly embedded itself in Kenya/East Africa's economy.

Our railroads, telecoms infrastructure, mobile phones, road and construction, sovereign debt bondage in loans, trade and commerce (huge!) /33
I call this the Chinese corridor.

I am familiar with East Africa - China corridor. Its insane!

People talk about remittances from North America, UK, Europe to East Africa. . . that is peanuts compared to volume of trade 34/
A holistic perspective by @prepaid_africa… /35
The comparative global impact of Alibaba vs. Amazon

East vs West?… /36
Great read on some background why natural outcome of Chinese dominance

What does it mean when Chinese manufacturers enter the social enterprise space?… 37/
"the market has been destroyed”.

While its just one category at the moment, how soon before its all the others as the increasing purchasing power and aspirations of the informal economy seek the best bang for their rupee, kwacha or shilling? /38
Will pick up on this thread later. stuff...
Bitcoin cash is a fork of bitcoin that attempts to make possible low cost p2p cryptopayments.

As a project, enabling p2p payments from micropayamnets up to bulk payments is a project priority

How to pay online at the lowest cost fee /39
So far, the bitcoin cash project has been fairly successful. eg Yours - a blogging platform w/ microtipping on content via bitcoin cash Ryan Charles CEO

" enables contributors to earn bitcoin cash for creating content"

Bitcoin cash (BCH) is a great cryptocurrency option for online payments (and micropyaments)

Bitmain & Jihan were huge backers of Bitcoin Cash, run largest share of BCH mining pool and Jihan says BCH is like Bitcoin in 2011 /41

1. An interview with Wu Jihan on Stories Behind the Birth of BCH and the Road to Future (1)…

2. An interview with Wu Jihan on Stories Behind the Birth of BCH and Road to Future (2)… /42
Generally, i believe all crypto is built for native web value exchange. So in the medium long term, one (or more) crypto will succeed in online payments in some form.

Micropayments is a start for online content

Current online payment methods fails at micropayments /43
So the question is where does Bitmain, mobile phones, Opera, Bitcoin Cash and or cryptocurrencies fit into Africa's future ? Or Africa payments? /44
I see two plays here

1. Hardware play (chips, phone hardware, hardware manufacturing)
2. App layer (payments, crypto, wallets, crypto assets, exchange)

People often forget one main reason why Mpesa was such a success story ws due to proprietary ownership of embedded SIM in all Safaricom mobile subcriber phones

Mpesa runs as a SIM application
Every SIM is an embedded chip
SIM chip is wholly owned by Service provider /46
SIM Chip hosts 'apps' equivalent of multiple private keys for different applications

Safaricom, largest dominant telcos owns 70% market share, meaning 70% of phones run native SIM chip wholly owned and controlled by Safaricom /47
Safaricom and Vodafone UK own Mpesa

So every SIM chip card, on both feature phone and smartphone, running Mpesa mobile payments SIM applications, has a native SIM chip that is wholly owned by MNO and Mpesa /48
engineers will appreciate this.

Means telcos network ie Safaricom is a web equivalent owned by a telcos company sole gateway

Mpesa is an app on this telcos

Basically a permissioned network where Safaricom decides who runs apps on secure SIM chip /49
Relevant reading

Why Blockchain is death knell for Mpesa… /50
Lol! this is the most sophisticated ruse thats been shipped out of East Africa

Mpesa is basically an 'app' on a 'permissioned' network where the owner of the network decides who can use the native chip for signing transactions using a private key

it a genius move! /51
This means, that for the past 10 years+ of successful mobile payments (p2p locally and regionally), owning the GSM mobile network and chip was key to success

Most recently, East African banks have leased SIM chip capacity via MVNO /52
Point is, key to success was

1. Owning GSM network - build mast, scale, base stations etc
2. Own the SIM card chip where all private key signatures are executed

Engineers will appreciate significance of private key signatures on a chip for over the network comms /53
Doubly worse

Telcos companies charge a fee to run apps that rely on this SIM chip card!

Can you believe this?

Pay to use. gatekeeper rules.

You want to use OUR Sim to sign TXns on a network --- pay to use! /54
Here is what i mean

On my phone> under SIM applications> Safaricom/Mpesa > Loans and Savings > Mshwari and KCBMpesa /55
Mswhari and KCB Mpesa are 2 banking products running as 'apps' on Safaricom's Mpesa SIM

Mswhari owned by CBA bank
KCB Mpesa owned by KCB

They get access to data from this permissioned network for mobile phones

For this, they pay 30% and 20% of profits on interest on loans /56
Relevant reading

Why we should Slay Mpesa, and save the town… /57
I've always thought the future is money over IP (including issued electronic money like Mpesa)

Time for some mobile money internet

How can we issue value on secure hardware chips on mobile phones linked to the internet network (not MNO GSM network)? /58
Relevant reading

Michael Bumann @Bumi

Building an Open Source Mobile Money System for financial inclusion… /59
On the hardware front, i see a chip play. OEM industry has been trying to lock down a secure chip element into smartphones for security on the software/app layer

So i wonder if bitmain + phone manufacturers could do this for a chinese app (Opera) + new market in Africa /60
2. App layer

This is where Opera has been making moves.

100 million+ users
Opera news most downloaded app by users
Recent launch of Opay - African Fintech payments company /61
In January this year, Opera ramped up operations in Africa. Opened an Office dedicated to Africa backed by $100 million budget. Headquarters Nairobi, Kenya

Opera appointed Eddie Ndichu as MD, launched an online payment wallet, Opay and more (see pic) /62
“For years Opera has been invested in bringing fast and affordable internet access for all. . . we are seeking local partners to integrate value-added services, fintech products and data bundling into its browser platform” ndichu said
Says a lot if you ask me. Having observed local payments industry, Ndichu knows all about mobile payments in East africa

local p2p transfers (bank and mobile money)
card payments
remittances (in country, cross border)
merchant payments (in country, online)
remote payments

Over the past 10years + East african payments grew from

p2p remittances
value store/banking
buy virtual goods/services
buy real goods/services (merchant payments)
remote bill payments
cross border remittances
digital lending/microloans

and most recently

Online payments/65
Opay, Opera's Fintech subsidiary in Kenya launched Okash, an app for microlending. users can access small loans for an interest as low as 1 per cent per day for a maximum of 14 days /66
Opera also integrates a web payment solution first in Kenya - a prepaid wallet for topping up mobile airtime, pay utility bills, free credit and cash backs (rewards/incentives)… /67
"Opay will accommodate multiple payment methods, from major credit cards to Airtel Money and M-Pesa."

Opay accomodates local payment methods/ cash in cash out channels /68
Opera typically has incentives/rewards to push app adoption "credits" and "cashbacks" /69
This week

Opera adds a crypto wallet to its mobile browser… /70
Opera introduces first browser with built-in Crypto Wallet /71
In Kenya and east africa, local p2p payments via electronic money on mobile phone has been solved. There is no room here for crypto.

Almost everyone in east africa has a mobile phone, that can store digital value and send/receive and cash out from 1000s of agents /72
It works great already.

local mobile payments work. within Kenya, within countries in East Africa.

Gap is in bridging cross border value transfer (via mobile) and bridging local payment options with online world

geographical borders
virtual borders /73
Sending money into the country/region is a pain - manageable, but can be better. This is why startups like Bitpesa started by offering remittance on bitcoin from UK. Also why now they use bitcoin for b2b payments and for moving value destined for micro loans in Kenya /74
"Borrowers receive funding on Bitbond, loan paid out directly to a mobile money or bank account. BitPesa pays local currency to borrower’s preferred payment option within minutes. The integration between Bitbond and BitPesa is now live in Kenya, Nigeria, Uganda,Tanzania." /75
But Moving value from KES to online or cross border much bigger problem.

Kenyan banks rely on cards, which dont work great. Lots of fraud by their own admission

Local prepaid SIM based wallets aren't designed to link to the web.

All we have is a patchwork of partnerships/ 76
Best attempt has been PayPal link "Safaricom and Mpesa announced a partnership with PayPal and TransferTo that will allow M-Pesa users to receive money from any PayPal account across the world directly into their M-PESA accounts in real time."… /77
Well its shite!

Its not real time - takes an hour to 3 hours sometimes
its clunky
its ridden with identity fraud

What it represents is the next phase of Kenyan payment industry. Online.

Its why Bitcoin has creeped into this space… /78
People shopping online in Kenya on China's ecommerce platforms or trading partners in China use WePay to pay for stuff

Why this piece of news happened

Alipay and WeChat Pay Coming to Kenya via Equitel… /79
Talk to any local payment startup, they'll tell you Chinese companies like Alibaba hate to have to deal with multiple currencies for all the countries in Africa

they also hate to have to deal with regulations for each and every country

So a single gateway would be ideal /80
So with 50+ currencies in Africa, Opera's wallet + crypto could standardize exchange across markets in Africa

So i definitely think there is a regional, cross border, online payment play for Opera over the next 4 years /81
Perhaps Bitmain might have a role in this via bitcoin cash or bitcoin or whatevs

Or maybe Bitmain sticks to embedded phone chips

But i also wonder if this type of chip could serve as a security enabler on the app layer (Opera), just like Safaricom does with Mpesa for GSM /82
Maybe Opera and Bitmain might do crypto airdrops for incentives to grow browser numbers.

If they're serious about Africa, they'll do whatever it takes to grow/retain market share

So they'll have an open mind to how the space here can evolve /83
All this is happening at a time when interest in bitcoin and cryptocurrencies across the region is at a peak.

So back to my earlier tweet on

linked to local payments
access to crypto
for buzzing demand

Opera will have its eyes on this space too/ 89
Here is Opera MD Africa making nice with Kenya's Blockchain and AI Taskforce

Coincidence? /90
Here he says

"Distributed web means wallets will no longer be separated with use-cases as e-commerce works today, allow a browser connect to Blockchain platforms and make payments native to the browser, without any payment processor or intermediate!" 91/
Meanwhile, across the border in Uganda 🇺🇬, our neighbours now have a fiat - crypto exchange gateway thanks to Binance

Official Launch of Binance Uganda Fiat-Crypto Exchange… /92
I think all the pieces arr coming together and ive never been more bullish about the future of cryptocurrencies within an East African context

ANother exciting couple of years coming up! Woo hoo! /93
Thread brought to you by @chamapesa


We recently put out a short film w/ Proof Of Work Media

Comparative Advantage: When the Unbanked Self Organize…

Adding one last thing on this thread and moneybutton are bitcioin cash based seamless content and payment tools for online

Bitmain is an investor in Yours, a company by Ryan Charles X /95
In this video from min 37, Ryan Charles talks about the moneybutton, online payments and what will be possible for online browsers using bitcoin cash online payment tools

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