THE WORLD WIDE WEB3
* Data as of 08:20 PM WAT, March 19, 2023.
Over the weekend, bitcoin rose to a nine-month high of $27,000 and some, like Coinbase’s former CTP, believe it will continue to rise. CoinTelegraph reports that Balaji Srivansan has made a $2 million bet that bitcoin’s price will rise from $27,000 to $1 million within the next 90 days.
General Bytes, a major cryptocurrency ATM manufacturer was hacked over the weekend. Bitcoin.com reports that over $1.5 million in bitcoin was stolen from a security incident on March 17 and 18 that allowed hackers access the company’s interface remotely and transfer funds illegally.
Saudi Arabia’s first licensed NFT marketplace has received funding from Animoca and Polygon.Binance reports that Nuktah received an undisclosed amount in seed funding to push its mission of offering businesses and brands a launchpad where they can deploy and monetise NFT collections.
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NIGERIA APPROVES $5.4 MILLION FOR DIGITAL CENSUS
Nigeria has shifted its first digital census—its first census in 17 years—from March 29 to May 2023.
According to minister of information and culture Lai Mohammed, the census was shifted to accommodate the country’s gubernatorial elections which was also postponed by a week in March.
The news comes on the heels of the Federal Executive Council (FEC) approving ₦2.8 billion ($5.4 million) for the procurement of the software that will be used for its first digital census.
In February, the FEC also approved an ₦85 billion ($184 million) contract for the provision of Personal Digital Assistants (PDAs) required for the census. The contract was awarded to Zinox Technologies, a pioneer original equipment manufacturer in West Africa. “We are deploying all our resources to make sure it is successful,” Kelechi Okonta, MD of Zinox Technologies, said.
It is unclear, at this moment, what software the latest fund will be used to acquire. The Nigerian government, however, budgeted ₦177.33 billion ($385 million) for the digital census project.
Big picture: It is also unclear how successful the Nigerian government will be in implementing tech solutions for national projects; it already has a poor reputation in this area. For its recently concluded general elections, the federal government budgeted about $663 million for the acquisition and use of digital tech devices like the Bimodal Voter Accreditation System (BVAS). On the day of its presidential election, the system flopped and INEC reported that—despite its huge budget and one-year timeframe—the system was not prepared to be used on such a large scale. 🤦🏾♂️
ONEPIPE SHORTENS ITS STAFF
Nigeria-based embedded finance startup OnePipe is the latest African startup to conduct layoffs.
According to sources close to the company, at least 20% of the company’s 38 employees were laid off last week as a result of what CEO Ope Adeoye described as “macroeconomic factors”.
Affected employees will receive two months of severance pay, per the terms of their contract. Adeoye, in an email confirming the layoffs to TechCabal, also revealed that the startup’s leadership team will be taking salary cuts.
OnePipe is one of the African startups that held deposits in the now-defunct Silicon Valley Bank (SVB). While US regulators have announced that all depositors will be reimbursed, sources close to OnePipe said the situation prompted more urgency within the company. Adeoye said the company will now focus on specific initiatives and “cut back several experimental projects”.
Meanwhile, the company recently closed a $4.8 million credit line from pan-African investment firm, TLG Capital. The deal, which had been in the works since the third quarter of last year, will power the startup’s inventory finance solution for small businesses.
“[We received] a revolving line [credit] specifically required to fund inventory finance for small shops via the FMCG distributors that work with us and the terms do not give us the latitude to use it for anything else,” Adeoye said.
OnePipe hopes to leverage the investment by TLG Capital to expand operations and become a premier provider of financial services to Nigeria’s informal sector in Nigeria.
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TC INSIGHTS: TACKLING FINTECH FRAUD IN AFRICA
The rapid growth of fintech startups in Africa over the years has led to a sharp increase in online fraud, threatening Africa’s budding digital payments ecosystem. For instance, in Nigeria, the number of online fraud reports made by financial institutions in 2021 was about 120 times that of 2014, according to data from Nigeria Inter-Bank Settlement Scheme (NIBSS) and Enhancing Financial Innovation & Access (EFInA).
Recently, Africa’s most valuable fintech, Flutterwave, faced an alleged hack with an unusual trend of 69 transactions worth $6.3 million. As a result, some of Nigeria’s fintech players are now working on a joint strategy to tackle rising fraud cases, starting with the plans of a shared blacklist. This was also necessitated by the rise in fraudsters exploiting weaknesses in the financial system, and also the lack of data-sharing between companies to identify the actors. In the long run, this strategy could significantly reduce the number of fraudulent transactions and improve consumer trust in the financial sector on the continent.
According to Ademola Adekunbi, a financial technology and data protection lawyer, technical cybersecurity must always be a priority for fintechs, as there must be strong controls from the KYC and onboarding stage to ensure that bad actors are not able to hack the apps and the underlying transaction systems. “They must invest hugely into penetration testing to ensure they block off all potential exploits,” he said. He, however, believes fintech companies sharing data to identify such fraud actors should be done under strict conditions.
Due to growing concerns about personal data breaches, regulators have put restrictions in place on how financial institutions can transfer people’s data under data protection laws. So, it could be inappropriate for fintech companies to operate a blacklist system without concrete transparency controls and fair parameters to ensure users have the opportunity to challenge the inclusion of names.
On the other hand, venture capital firms may figure out there is a heightened risk to their fintech portfolio companies due to fraud. And to account for that risk, they tend to reduce their investment sums or discount the valuations at which they invest. All things considered, as investors are always risk-averse, recurrent fraud cases may impede the fundraising efforts of African fintech startups.
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EVENTS: TECHCABAL AT 10
Here’s a list of all the Twitter Spaces we’ll be holding to celebrate our 10th-year anniversary.
- March 21—Meet the team telling African tech stories that matter. TechCabal captures the players, human impact and business of tech in Africa. We provide the content, reporting, data, and context to help the world understand how tech is changing Africa. Who are the journalists doing all of this important work? Find out here.
- March 23—What is the future of tech in Africa? In the last 10 years, the African tech ecosystem has evolved quickly. We know this firsthand at TechCabal. What does the future look like? Join us for an insightful conversation with Ola Brown, Stephen Deng, Hope Ditlhakanyane, and Ngozi Dozie where we answer these questions. Set a reminder here.
- March 30—The role of the media in covering African tech. How can the media help Africa’s developing tech ecosystem? What responsibility does the media owe the ecosystem, and what can the media expect in return? Should the media only cover the good stories? Find out here.
Written by – Timi Odueso & Ayomide Agbaje
Edited by – Kelechi Njoku
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