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Could Blockchain-Powered Anarcho-Capitalism Thrive in Africa?

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Blockchain-Powered Anarcho-Capitalism

Africa is home to some of the most corrupt governments in the world. According to the Transparency International Corruption Perception Index 2017, 11 out of the 20 most corrupt countries are located on the African continent. These nations are also among some of the worst performing countries when it comes to socio-economic development.

This data suggests that the state is at least partly responsible for many of the economic and social challenges faced by Africans today. This begs the question: “Would African nations fare better if they were not restrained by the state?”

In this article, we will explore a political school of thought called anarcho-capitalism, which promotes the replacement of the state with a free-market based system that empowers citizens through self-ownership and private property and whether blockchain-driven anarcho-capitalism could provide a viable alternative model for socio-economically struggling nations in Africa.

What is Anarcho-Capitalism?

Anarcho-Capitalism

Anarcho-capitalism, also referred to as libertarian anarchy or free-market anarchism, is a political philosophy that advocates the elimination of the centralised state in favour of individual sovereignty and free markets.

Anarcho-capitalists believe that in the absence of statute societies self-regulate through what is referred to as spontaneous order – an order which emerges as a result of the voluntary activities of individuals and not one that is created by a government.

In an anarcho-capitalist society, instead of having government-run public sector institutions such as law enforcement and courts that are funded by taxation, these services would be operated by privately-funded businesses who are chosen by consumers in the open market. This, in turn, should create a more efficient economy with better services.

Legal disputes would be resolved using tort and contract law through dispute resolution organisations as opposed to through punishment determined by political monopolies, which tend to become corrupted.

As opposed to the public image of anarchy, which often associates this political concept to chaos and lawlessness, anarcho-capitalism is based on the non-aggression principle (NAP). In simple terms, the non-aggression principle states that you should not assert aggression towards others or their property as this is deemed unethical.

Anarchism is also often linked to left-wing political schools of thought such as socialism and communism. However, while there is a large anarcho-communist community, not all anarchists are opposed to private ownership of property and free-market economics. In fact, the anarcho-capitalist movement has been growing in recent years in places like the United States and Europe due to the dissatisfaction with the performance of recent and current governments.

The term “anarcho-capitalism” was coined by Murray Rothbard, an American economist, historian and political theorist, in the 20th century. Rothbard believed that:

“Capitalism is the fullest expression of anarchism, and anarchism is the fullest expression of capitalism.”

Anarchism in Africa

Africa is not foreign to anarchist societies. Author Sam Mbah and I. E. Igariwey suggest in their book, ‘African Anarchism: The History of a Movement’, that many traditional African societies were built on anarchic elements and lacked state-like hierarchies.

“To a greater or lesser extent, all of […] traditional African societies manifested “anarchic elements” which, upon close examination, lend credence to the historical truism that governments have not always existed. They are but a recent phenomenon and are, therefore, not inevitable in human society. While some “anarchic” features of traditional African societies existed largely in past stages of development, some of them persist and remain pronounced to this day.”

“What this means is that the ideals underlying anarchism may not be so new in the African context. What is new is the concept of anarchism as a social movement or ideology. Anarchy as an abstraction may indeed be remote to Africans, but it is not at all unknown as a way of life. This is not fully appreciated because there is not as yet a systematic body of anarchist thought that is peculiarly African in origin,” the authors wrote.

How a Blockchain-Powered “Decentralised Economy” Could Disintermediate the State

The power of decentralised applications (DApps) and the new “decentralised economy” lies in the disintermediation of central authority. This does not only apply to businesses who act as intermediaries (such as financial institutions for financial transactions for example) but can also apply to public sector institutions.

Through the adoption of decentralised services, many centrally governed services that governments (aim to) provide could be largely replaced. The issuance of identities, business lending, asset and land ownership, startup funding, legally binding smart contracts, a direct peer-to-peer sharing economy, and decentralised digital currencies are among the possibilities that blockchain technology could provide to disintermediate many of the state’s functions.

anarcho-capitalismThe issuance of digital identities could be performed using a blockchain-powered database that does not require a centrally governed authority to oversee it. Instead, individuals could create their identities on the platform, and third parties who may require information on the individual could access it with the individual’s permission.

Business lending, as well as startup funding, which is often conducted through government grants or investment schemes, could be run by the private sector using blockchain solutions instead. Business lending, for example, could be performed on a peer-to-peer lending basis where investors lend to businesses directly without an intermediary taking a cut. Startup funding, on the other hand, could be conducted through initial coin offerings or security token offerings.

Asset and land ownership and transfers could be conducted on blockchain-based platforms for all stakeholders to view in a transparent and immutable manner. This way, there would be no need for public sector officials to become involved in the process and fees – and the potential for corruption – would thus be reduced.

Contractual agreements between businesses and individuals could be coded into immutable self-executing smart contracts, which would reduce the need for centrally-governed courtroom interventions in the matters between individuals and businesses. Moreover, the widespread adoption and societal implementation of smart contracts could drastically reduce the need for laws and bureaucratic legislation.

A true peer-to-peer sharing economy could also be created using blockchain technology, which could replace many public sector services with private sector solutions such as specialised healthcare or transport services, for example.

Furthermore, decentralised digital currencies such as bitcoin would eliminate the need for a central bank to meddle in the monetary affairs of a country and could empower citizens to “be their own bank” as opposed to relying on financial intermediaries to conduct their financial affairs.

Could Blockchain-Powered Anarcho-Capitalism Work in Africa?

It is difficult to know with any degree of certainty whether socio-economically struggling African nations would benefit from introducing blockchain-driven anarcho-capitalism as there have been little to no anarcho-capitalist societies to date.

According to freeblr, anarcho-capitalist societies have existed in the past, most notably in Celtic Ireland from 650 to 1650 and in the Icelandic Commonwealth from 930 to 1263. However, as these historical instances of anarcho-capitalism date back several hundred years it is difficult to determine whether these societies were truly 100 percent stateless and capitalist, and how well these societies functioned.

Anarcho-capitalism thus remains largely a political ideal and theoretical model that stands untested in modern history. This makes it difficult to judge whether an anarcho-capitalist society would flourish in countries that have suffered under corrupt governments.

In theory, however, anarcho-capitalism has the potential to create more wealth for a larger number of people in a society where it would be introduced. If you take away the state and its restrictive regulations, crony capitalism, and taxation, entrepreneurship and innovation could thrive while workers would be able to take home their entire paycheck as opposed to giving a share to their politicians.

The economy, in an anarcho-capitalist society, would become more efficient as private companies would have to compete to offer the best possible products and services that the consumer can then choose from. That would mean lower prices, higher quality products, and better services than in the current state of the economy.

Anarchy in AfricaInterestingly, one could argue that a high degree of economic and entrepreneurial freedom already exists in most African nations due to its thriving informal sectors that stay mostly untouched by government rules and regulations. Vendors in poor areas, for example, are often able to sell their goods wherever they please without government interference and taxation is only sporadically enforced in many African slums. This would suggest that anarcho-capitalism can be found in pockets of Africa’s society today.

The lack of effective state-led policing in many African nations would also feed into this argument as punishment for crimes is often enacted by local communities themselves as a form of self-governing, which could be considered as quasi-dispute resolution organisations.

In light of Africa’s experience with anarchy in many of its traditional societies, the lack of state-control in many of the poorer parts of the continent, and African citizens’ general distrust of governments and their institutions would suggest that the continent may be fertile ground for anarcho-capitalism. Through the widespread adoption of decentralised blockchain solutions, many of the government’s functions could be disintermediated and would thus become redundant, which would also feed into the argument that anarcho-capitalism could potential thrive in Africa.

Whether struggling African nations would be better off through the adoption of a free-market economy without government interference will remain unknown until the first libertarian society that embraces anarcho-capitalist ideals comes to fruition on African soil.

Unfortunately, due to corrupt government officials and the omnipresent corporate cronyism found all over Africa, it would be an uphill battle for the brave souls who attempt to create a free society based on the non-aggression principle, individual liberty, and personal financial sovereignty.

Blockchain Technology

AI and Blockchain-Powered Project CareAi Could Improve Healthcare in Africa

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CareAi

CareAi is a project of the Joint Research Centre from the European Commission that has the potential to improve healthcare services in Africa through the use of artificial intelligence and blockchain technology.

The open-source solution provides intelligent and anonymous healthcare and can diagnose diseases like typhoid fever, malaria, and tuberculosis within seconds through the use of AI. The aim of the project is to reach out to undocumented migrants, ethnic minorities, and populations secluded from healthcare systems. The anonymous nature of CareAi also allows patients such as migrants to receive a diagnosis without worrying about deportation.

How It Works

CareAi is a machine featuring a finger prick and a lab-on-a-chip technology initiated by a Harvard University chemistry professor called George Whitesides.

To receive a diagnosis, a patient will have their finger pricked and the blood sample is deposited on the chip, put in the machine, and anonymised. Once this is done, CareAi’s AI-powered health assistant analyses the sample by referencing it to a wide range of medical and diagnosing data and then displays the results on a screen and provides a printout for the same.

The results come with actions that the user should take such as getting a prescription from partner chemists or seeing a participating NGO doctor that provides anonymous treatment and who can claim back payment for services rendered.

Additionally, CareAi correlates medical data with records of academic data and journals anonymously. The anonymised data is securely stored on the blockchain while smart contracts manage the rights, permission, and access to the stored health data.

Organisations use a distributed app to access the data through smart contracts. For instance, if a government wants to access the stored data for policy purposes, it has to buy tokens called CareAi Points. These tokens are then used to pay the participating healthcare NGOs and for machine maintenance.

According to a Medium article by Lucas Lorenzo, these points can propel “economic interactions in the form of a valued currency, locally and at scale; exchanging economic value and intelligent healthcare feedback for anonymised data.”

The Possible Applications of CareAi in Africa

CareAiAlthough CareAi targets refugee camps in Europe, the technology could also make a positive impact on the African continent according to the founder of cloud-based health records platform Medcera, Ndubuisi Ekekwe. He believes:

“[…] Products like CareAi could become catalytic when they begin to penetrate into villages and cities across the continent. If AI systems could handle some of the minor healthcare issues, the available healthcare professionals could focus on the most difficult issues.”

Ekekwe also says AI systems, such as CareAi, can enhance drug prescriptions where the medical history of a person is entered into the system. This enables the AI system to confidently prescribe drugs and connect the patient to the right pharmacy.

However, he notes that although AI and blockchain technology could change the healthcare systems in Africa, nations must invest in other areas such as training more healthcare professionals and installing electricity and clean water in all healthcare facilities. He also believes that the challenge of inadequate data has to be solved for AI to have a future on the continent.

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Kenya’s RideSafe to Receive $140,000 in Funding from Aeternity Starfleet Incubator

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RideSafe

Kenyan tech startup RideSafe is set to receive $140,000 in seed funding from the Aeternity Starfleet Incubator, which it partook in earlier this year.

In Kenya, one of the easiest ways to get around is through motorcycles known as “boda bodas.” This subsection of the transport industry has been largely unregulated, creating a myriad of risks for riders and commuters alike. It is, therefore, quite likely to find riders creating associations or small social groups for their collective interests and pooling their resources and support in order to secure solutions for financing, health, and insurance.

RideSafe is a startup that has stepped up to provide health solutions for riders in real-time in case of accidents. Many riders are exposed to hazardous conditions daily. Hence, there is a need for robust solutions to safeguard their wellbeing.

Æternity Starfleet Incubator

RideSafe

Image by RideSafeApp.com

Earlier this year, RideSafe participated in the Aeternity Starfleet Incubator, which is specially designed to empower startups that seek to leverage blockchain technologies. From an initial round of 60 participants, RideSafe qualified for the shortlist of 17 teams, among which Vite and Utu were the only other African startups to participate.

Asiimwe Benson, the CEO of RideSafe, revealed in an interview that he met the Aeternity team at the World Blockchain Summit in Nairobi in early 2018, where he got an opportunity to sign up for the incubator and funding. With the $140,000 prize, the CEO intends to expand operations to serve more riders nationally; ultimately targeting the masses. The funding will also be used to build capacity and secure technical support.

Nikola Stojanow, the CEO of Aeternity Ventures, remarked that the finalists of their training program demonstrated passion, dedication, and far-reaching potential through their ability to take counsel and fine-tune their business models and road maps for best practice.

The ten teams that made it through Aeternity’s incubator have paved the way for other teams and startups to learn and gain meaningful experience in sustainably innovating solutions based on blockchain technology.

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Coinfirm Partners with KAD ICT Hub to Launch Africa Blockchain Lab in Nigeria

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Africa Blockchain Lab

London-based blockchain regtech company Coinfirm and Nigeria’s KAD ICT Hub have launched the Africa Blockchain Lab with the aim of taking up companies focused on creating blockchain-based services and products for African economies.

The new hub based in Kaduna, Nigeria is especially interested in companies that are focused on financial inclusion and has already accommodated one such startup called Kora.

Kora, founded in 2017 by Dickson Nsofor and Maomao Hu, is a blockchain-based infrastructure for an inclusive financial system. According to the Inclusive Growth Forum, “the Kora Network will provide access to identity, secure storage, money transfer, and marketplaces on a low cost, universal access platform accessible via SMS/USSD on feature phones, or with internet access via a mobile app, enabled by blockchain technology.”

CoinfirmCoinfirm’s co-founder and CMO Grant Blaisdell said in a press release: “A Silicon Valley out-of-the-box solution approach has generally not worked in regions such as Africa; it requires a ground-up, organic approach. Coinfirm has already successfully built leading blockchain solutions, the largest structured blockchain database and coverage, and the first blockchain lab for Central Europe. Now, working with KAD ICT Hub, who share our vision of bringing transformative, blockchain-based solutions to African markets, and who have the local knowledge and expertise, we are going to do the same in Africa.” He added:

“We want to work with and provide opportunities for African entrepreneurs working in one of the most exciting and disruptive fields today while bringing our own solutions like our AML/KYC Platform and AMLT Network.”

The KAD ICT Hub

Launched in 2017, the KAD ICT Hub based in Kaduna, Nigeria is an IT innovation hub that receives support from the Nigerian government.

Africa Blockchain LabCo-founder and chief executive of the KAD ICT Hub Yusuf Bashir said: “[…] The transformative potential of blockchain is enormous, and we are confident that, working with Coinfirm, we can provide the testbed and support for today’s leading African blockchain companies, giving them the opportunity to become global leaders. Here in Kaduna, Nigeria’s third-largest state in terms of population, and leading learning and innovation hub, we are extremely fortunate to have a governor who is not only supportive of what we are doing but had ensured we are backed by the Kaduna State Government.”

The hub has been working with Trudatum, Coinfirm’s blockchain-based data document verification platform, which Poland’s largest bank PKO Bank Polski has recently started to use. Additionally, Trudatum could be used in Nigeria to securely store documents in government institutions and universities.

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