Bitcoin Arrives in Africa's Largest Slum

"In many cases, people in Kibera do not have an opportunity to secure their lives with normal savings," said AfriBit Africa co-founder Ronnie Mdawida. With bitcoin, "they do not need documentation to have a bank account … that gives them the foundation for financial freedom." AfriBit Africa introduced bitcoin into Soweto West in early 2022 through crypto-denominated grants to local garbage collectors. The groups are made up of dozens of young people, who Mdawida says are more likely to be open to new tech. After gathering on a Sunday to collect trash, garbage collectors are paid a few dollars' worth of bitcoin. AfriBit Africa estimates that it has put some $10,000 into the community, with garbage collectors acting as the main agents of spreading bitcoin in Soweto West.

Damiano Magak, 23, a garbage collector and food seller, said he prefers bitcoin to M-PESA, the ubiquitous mobile money platform in Kenya, because M-PESA transaction costs are higher and the network can be slower. Some merchants have found benefits to accepting crypto, including Dotea Anyim. She said around 10% of customers at her vegetable stand pay in bitcoin. "I like it because it is cheap and fast and doesn't have any transaction costs," she says.

The possibility that crypto prices could keep rising also appeals to residents of Soweto West. Magak and Many said they now have around 70% to 80% of their net worth in bitcoin, a far higher level of exposure than most people. That concerns Ali Hussein Kassim, a fintech entrepreneur and chair of the FinTech Alliance in Kenya. "In an extremely volatile asset like bitcoin, it's overexposure," Kassim said. "You are exposing a vulnerable community to an ecosystem ... they can't necessarily afford to play in."