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Crypto – A solution to Intra-African trade in a post-covid world

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The need for efficient intra-African trade is more prominent now than ever. A major reason for this is the invasion of the novel coronavirus which disrupted the status quo. Now, it wasn’t that the status quo was working as it should as we could see many African economies already struggling with incessant inflation and lack of drivers for growth even before the pandemic. However, with COVID-19, things got worse.

For instance, SMEs could no longer perform businesses smoothly because they relied on an existing model that made use of traditional channels powered by local fiat currencies. And if anything is known about the shortcomings of fiat especially within Africa, it is that regulations and tariffs are a major blocker for trade between African nations. Thus, the already existing flawed system collapsed under the weight of COVID-19.

In light of this, experts and global powers have identified trade as a crucial driver of growth for African economies seeing that it solves many problems particular to these nations, as well as promote a better relationship between the nations in terms of both exports and imports and human resources. This is why a number of regional/sub-regional organizations that were set up to facilitate smooth political and economic relations between African countries have recently focused on finding ways to facilitate intra-African trades.

A notable move was the establishment of the African Continental Free Trade Agreement (afCFTA) which aims to lower or eliminate tariffs on 90% of goods. While this is projected to improve intra-trade relations by 33%, certain issues with the existing model on which this trade will operate remains a critical cause of concern.

Trade in a post-covid Africa

With the world adjusting to the “new normal”, it is necessary to understand the implication on businesses and trades. For context, two things will be considered:

– The impact of COVID on transportation: For a while, everything was at a standstill in an effort to reduce the spread rate of the virus. This affected movements of people and goods. But the world soon learned to take precautions and things started returning to normal. However, what that meant was that extra care must now be taken where physical exchange of goods and even money was involved. While the export of raw materials from African nations and the import and redistribution of finished products were

previously placed on hold, now a well-structured transport system that accounts for the new reality has allowed the resumption of this exchange. This leaves the issue of money.

– The impact of COVID on financial transactions: Even before the pandemic, cross-border payment within Africa has been a major problem, mainly because of the cost of sending money and the time taken. Using traditional mediums to send money often incur huge transaction costs. For instance, sending money from Zambia to Senegal could incur over 10% of the money to be sent as transaction cost. The other part is the time taken to complete the transaction due to the intermediary checks processes, several days often pass before payment is received by the recipient.

In a 2019 report, more than half of Nigerians and South Africans said it took them more than a day to receive money transferred to them from within the continent. And, due to Covid, the exchange of physical cash is not really an option. Besides, a sender would need to convert the money to different currencies if they were a distributor with retailers in different countries. It just doesn’t make sense.

Part of the proposed solution to the absence of a unified currency is the creation of the African Central Bank which is to be completed by 2028. This institution will be responsible for the issuing of an official single currency for Africa. But the challenge with this plan is that the world is fast moving away from depending on fiat currencies because of the inefficiencies often associated with a central issuer.

In addition, there is a lack of trust within African governments that may impact the success of such an initiative. Furthermore, in the dawn of a fast-moving Africa where new businesses are being established, there is an urgent need for an effective way to trade goods.

A crypto-themed solution
The invention of blockchain technology, on which many cryptocurrencies operate (including bitcoin), inherently solves many of the problems facing intra-African trade. First, the decentralized nature of the blockchain has allowed bitcoin to be a natural global currency. This is because, without a central issuer, it can be accepted anywhere and its value will be recognized. Also, without a middleman to complete transactions, the cost and time to complete transactions are greatly reduced.

Perhaps more importantly, it eliminates the need for trust. How bitcoin does this is simple: trust is needed in a world where transparency and security are absent — blockchain provides both. The blockchain is a distributed ledger that secures money with cryptography and records all transactions openly so that it is near impossible to alter the record. This makes it possible for businesses and governments to engage in trade via a channel with almost instant payment resolution and cheaper transaction costs.

An added advantage is that cryptocurrencies are fully digital, so with everyone going cashless in a way to reduce the spread of COVID, bitcoin solves this without any additional cost.

A pan-African payment system
Without a doubt, cryptocurrencies provide a better solution to the stifled growth of trade within Africa. While bitcoin has been mainly used for speculation by financial traders, in recent months, it has gained popularity as a payment tool — for which it was originally designed. In Africa, there has been an increase in the number of monthly transfers with bitcoin, according to US blockchain research firm, Chainalysis, with most of the activities taking place in Nigeria, South Africa and Kenya.

Recently, financial technology has taken a foothold in Africa. These startups are aiding the sending and receiving of money for Africans in the wake of the flawed traditional systems. However, more prominent in the African financial space are cryptocurrency fintech companies that are aiding individuals and businesses to send cryptocurrencies like bitcoin within and outside Africa.

A major advantage of crypto fintech over other fintech is that they also aid seamless trade between African countries. This is done by allowing the purchase of bitcoin in one’s local currency and sending it to other parts of Africa where the recipient can instantly convert to their own currency. Particularly, a pan-African crypto exchange like Yellow Card also offers Over The Counter (OTC) trading desks to governmental organizations and big corporations which is a cost-effective means of conducting cross-border trades without delay.

Conclusion

Bitcoin is built to solve existing problems with cross-border payments within Africa. The adoption of bitcoin as a payment method by African governments and organizations can fast track the plan for a better Africa. With efforts already in place to improve trade relations between countries, using an already recognized global currency like bitcoin saves time, cost and friction between the players to make this a reality.

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How to Buy USDT on the TRON network in Zambia

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Since their creation and use, cryptocurrencies are known for their volatility. But, amongst the crypto coins that are gaining popularity and tackling the problem of cryptocurrency volatility, Tether was introduced in 2014 and became USDT later on.  USDT because it is pegged to the U.S. dollar which does not change much in value.

What is USDT?

USDT is a blockchain-based cryptocurrency whose crypto coins in circulation are backed by an equivalent amount of traditional fiat currencies, like the Dollar, the Euro, or the Japanese Yen, which are held in a designated bank account.

It was specifically designed to bridge the gap between fiat currencies and cryptocurrencies and offer stability, transparency, and minimal transaction charges to users. It is pegged against the U.S. dollar and maintains a 1:1 ratio with the U.S. dollar in terms of value.

Why is USDT useful?

Tether is useful for crypto investors because it offers a way to avoid the extreme volatility of other cryptocurrencies.

Transaction cost: Having USDT (as opposed to the U.S. dollar, Euro or Yen) removes transaction costs and delays that impair trade execution within the crypto market.  With the COVID-19 repercussions, banks in Zambia are trying to attract more customers and stay in business though their fees and rates are relatively exorbitant. However, using USDT, Zambians get the opportunity to shy away from the banking fees as well as exchange rate margin that are charged by banks depending on the foreign currency.

Safe Haven Asset: USDT has a value that is designed to be stable over any period. This feature makes it an ideal safe haven asset because, unlike cryptocurrencies like Bitcoin that can fluctuate dramatically in price every day, an individual using stablecoins to store value see no risk of loss, especially because they have full custody of their asset.

Remittance: Cross-border payments and remittances are very real problems that Zambian emigrants face when trying to send money home. A World Bank report argues that Africans have to pay as high as $12 for any $100 sent home. If remittances are a major source of income for most African homes, it will be beneficial to have the cost of the transactions reduced to the advantage of the beneficiary populations.

The good news is that Zambians and other residents now have a safe platform to trade USDT with the ZMW at the best rates. Moreover, USDT on Yellow Card is available on the Tron network (TRC-20) which offers cheaper network fees to transfer your usdt between wallets.

How Do I Buy USDT in Zambia on Yellow Card?

To buy USDT on Yellow Card, follow these steps:

  1. Sign up for a Yellow Card account
  2. Fund your wallet with ZMW. You can add money to your wallet using bank transfer, SPENN or Airtel and MTN mobile money. To fund your account with kwacha:
  • Tap on Deposit
  • Select your preferred payment method
  • Entire the desired amount you want to deposit
  • Confirm the details of your deposit
  • Tap continue then confirm.
  1. Buy USDT on the TRON network. Just follow the steps below:
  • Tap on USDT
  • Tap on Trade
  • Tap on Buy
  • Enter your desired amount
  • Tap continue then confirm.

How Do I sell USDT in Zambia on Yellow Card?

You can also sell USDT on Yellow Card. Log in to your account and follow these steps:

  1. Tap on USDT
  2. Tap on Trade
  3. Tap on sell
  4. Enter your desired amount
  5. Tap continue
  6. Tap confirm

Once you have sold your USDT, you can easily withdraw your kwacha to your bank account or through SPENN.

Conclusion

Cryptocurrency enthusiasts in Zambia can trade USDT using Yellow Card services. Escaping the volatility of other cryptocurrencies and protecting your finances against inflation is an opportunity no one should miss.

Start trading USDT

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BOLABET-MWEBANTU FREE-BET CHALLENGE: Like, Share & Predict to WIN K300!

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BOLABET-MWEBANTU FREE-BET CHALLENGE – PREDICT THE OUTCOME OF 5 MATCHES AND WIN K300!

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1 – Home (Team to win),
X – Draw,
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You will need to predict the correct outcome of all 5 matches we offer you and you will win the K300 Freebet into your Bolabet account!

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2. Draw (X)
3. Away (2)
4. Home (1)
5. Away (2)

* In the above example, Match 1. – Home team to win, Match 2. Draw, Match 3. Away team to win, Match 4. Home team to win, Match 5. Away team to win. *

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– PREDICTIONS WHICH ARE NOT COMPLETELY WITH ALL TERMS AND CONDITIONS ARE NOT TAKEN INTO ACCOUNT FOR THE PRIZE.
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Lifestyle

EL Mukuka teams up with Sun-EL Musician & Gaz Mawete

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El Mukuka, arguably Zambia’s top DJ and Producer, has taken the month of July by storm with two powerful releases both in collaboration with African heavyweights. On July 2nd Mukuka released a song in Lingala entitled “Bosana” with popular Congolese singer Gaz Mawete and Belgian music producer HVMZA. 

“Bosana” scooped over 100,000 Spotify streams within just over a week of release, making it one of the fastest growing Zambian songs on the international market this month. “Bosana” also continues to pull in more and more support from radio and club DJs both in and out of Africa.

“I truly loved working on this song with Congolese heavyweight singer Gaz Mawete. His voice is so incredibly unique in tone and expression! As for HVMZA, this is already our second collaboration and definitely not the last. I love his style! I think ‘Bosana’ has a soulful & emotional touch that reminds me so much of summer sunsets over the ocean.” – El Mukuka

 On 23rd July (today) Mukuka delivers the much anticipated “Lost” remix by Sun-El Musician, one of South Africa’s most popular DJ/Producers, best known for his 2017 smash hit “Akanamali”. The original version of “Lost,” which features Nigerian star Adekunle Gold, came out earlier this year as the first release under El Mukuka’s new exclusive artist deal with Ultra Records.

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Foxdale Forest – Phase 2 Selling

ZAMBIA: COVID-19 STATS

21 Jan 2022, 3:50 AM (GMT)

Zambia Stats

300,587 Total Cases
3,885 Deaths
287,646 Recovered

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