Countless column inches have been devoted to Bitcoin's extraordinary price surge — with the world's biggest cryptocurrency recently hitting a new all-time high of $73,750. But beyond its attractiveness as an investment, less attention is paid to the digital asset's utility.
Back in 2008, Satoshi Nakamoto's whitepaper described Bitcoin as a "peer-to-peer electronic cash system" — a way of sending funds from A to B without an intermediary. Given remittances cost an average of 6.2%, eating into the incomes of the world's poorest, it's a worthy ambition.
Until now, Bitcoin's progress has been stymied by high transaction fees and a lack of scalability. But recent innovations like the Lightning Network have paid the way for BTC to be at the heart of cheaper, faster payments.
Another hurdle relates to how cryptocurrencies are too complicated for many consumers to understand. The prospect of long alphanumeric addresses can be daunting, not to mention the danger of funds being lost forever if they're mistyped. And while Bitcoin's presented as a tool for financial inclusion, supporting the underbanked, that's little solace for consumers in rural areas with no smartphone and no internet connection.
That's what makes Kgothatso Ngako's FinTech startup so interesting. Machankura enables its users to send and receive BTC directly to cell phone numbers. It's already live in Ghana, Kenya, Malawi, Namibia, Nigeria, South Africa and Zambia — on a continent where mobile money is huge business. Crucially, years-old devices without the modern features of iPhones are supported.
The premise is simple: Machankura uses USSD message codes to send information. Every country where Machankura operates has a specific number. Users are then directed through a simple registration process. Bitcoin can be purchased through vouchers at local stores, and then redeemed using a reference code. A 1% transaction fee is charged when BTC is sent to others. Phone numbers are used as usernames — or a human-readable address can be created instead.
Overall, this means Bitcoin can be used without an internet connection — offering millions of people an alternative to fiat currencies, some of which in Africa are addled by hyperinflation.
Transaction amounts in the app are denominated in satoshis — the smallest monetary unit of BTC. A satoshi is equivalent to a billionth of one Bitcoin. For example, $10 worth of BTC would work out at approximately 142,500 sats.
The "decentralized" spirit of the startup can be seen on its website. Machankura directs to platforms where Bitcoin can be spent on goods and services. It also has a special feature, "Machankura clans," for transactions approved collectively in a group. Most of the project’s social media updates are on decentralized platforms like Nost and Mattermost.
Ngako recently told CoinDesk that Machankura has now attracted over 13,600 customers. While this may appear to be a drop in the ocean given the continent is home to 1.21 billion people, its user base has almost quadrupled over the past 12 months.
While such a basic interface is a necessity to reach Africa's offline population, Machankura should still serve as an inspiration for crypto businesses operating in countries where smartphones are the norm. Why? Because focusing on simplicity and ease of use is crucial for onboarding new users — and encouraging them to see what Bitcoin has to offer.
