Bitcoin Circular Economy Takes Root in Africa's Largest Informal Settlement
In Kibera, Africa's largest informal settlement located 6.5 kilometers from Nairobi's city center, a Bitcoin-based economic system called Afribit has been developing over the past five years. Home to more than 500,000 residents, this community has embraced digital currency as a solution to financial exclusion, according to a report from Forbes.
Ronnie Mdawida, Director of the Afribit project, explained that "Bitcoin solves issues of financial sovereignty and financial inclusion." Many merchants in Kibera lack documentation required for traditional banking, preventing their participation in conventional economic systems. Bitcoin offers them an alternative pathway to build livelihoods and conduct business transactions.
The initiative began in 2019 when Yogi Golle, a Canadian who had been supporting Mdawida's community work since 2017, introduced him to Bitcoin's potential. Golle now serves as Strategic Advisor to Afribit. Their collaboration led to Bitcoin education programs that established the foundation for today's circular economy.
The impact of banking exclusion is substantial within the community. Of 50 participants in Afribit's waste management program who receive payment in satoshis (fractions of bitcoin):
- 19 have neither identification documents nor bank accounts
- 14 possess unused bank accounts they were forced to open for anticipated donations
- Others have had accounts closed due to inactivity or inability to pay monthly fees
Serah Mucha, an administrator with Afribit, noted that many residents must store cash at home, risking theft. While mobile money services like M-Pesa are common, their high transaction costs and vulnerability to issues such as payment reversals make them problematic for business use. Bitcoin provides a more secure and cost-effective option.
The program has evolved beyond its origins as an e-commerce platform. Afribit now offers "Bitcoin 101" and coding classes that have helped community members secure jobs as developers, designers, and IT technicians. One former student is developing a Lightning Network wallet specifically for the Afribit community. The waste management program, funded through donations, pays participants to collect and recycle waste while attending Bitcoin education sessions.
Afribit has onboarded over 40 merchants who now use Bitcoin not only for transactions but also as a savings tool. Despite this progress, challenges remain. Some residents view Bitcoin with skepticism due to its recent price increases, considering it "too good to be true." Mucha identifies maintaining sufficient Bitcoin liquidity as another key challenge to ensure the ecosystem continues to thrive.
Looking forward, the Afribit team plans to expand with new initiatives including Bitcoin loans for merchants, a customer loyalty program, and a peer-to-peer exchange to help new users join the network. Currently operating only in Soweto West, one section of Kibera, Mdawida aims to extend services to all 11 villages in the settlement. Golle envisions Afribit becoming a model for financial inclusion throughout East Africa by combining education, empowerment, and technology.
This grassroots adoption comes against a backdrop of broader institutional interest in Bitcoin across Africa. South African investment company Altvest Capital recently entered the Bitcoin market with its first purchase of one BTC, announcing a Bitcoin-only investment strategy that excludes other cryptocurrencies. Altvest CEO Warren Wheatley cited protection against the depreciation of the South African Rand and Bitcoin's decentralized nature among key factors for this decision. As the first publicly traded company in Africa to make such a move, Wheatley suggests other African companies, particularly from tech-forward nations like Rwanda and Kenya, may follow their example.
Meanwhile, in global markets, mining company Bitdeer Technologies has acquired 50 bitcoin during recent market volatility at an average price of $81,475 per bitcoin, increasing its total treasury to 855 BTC valued at approximately $69 million. This acquisition occurred during bitcoin's worst monthly performance since June 2022, reflecting a strategy of building reserves during price corrections rather than focusing on short-term market fluctuations. Such institutional adoption provides a contrasting approach to the community-level implementation seen in Kibera, yet both demonstrate growing confidence in Bitcoin's role in diverse economic contexts across the continent and beyond.
