In this exclusive chat with James Emejo, the Co-founder/Chief Executive, Paxful, a peer-to-peer marketplace, Mr. Ray Youssef, said the free flow of money remain key to financial inclusion, youth empowerment, and poverty alleviation in the country. Among other things, he said the use of bitcoin could boost foreign exchange earnings thereby straightening the local currency as well as putting the idle workforce to productive work. Excerpts
What is the vision of Paxful?
I have a dream that the global south will rise and turn the tables.
Right now, the global south has 80 per cent of the growth population and less than 20 per cent of its wealth. The young people are the greatest resources of the global south especially Nigeria. All that needs to happen for this dream to be a reality is that we need to break the bounds of what I call economic apartheid and that is what keeps us poor and not because we are lazy or corrupt but because money is not allowed to flow. If we just let the money flow, these people – young people, entrepreneurs, Nigeria, Africa, and the entire global south would have great wealth and history has proven that – all businesses are the story of free trade. If you let free trade happen and wealth would be created and free trade can only happen when you have free payments; we’ve inhibited that and we are going to fix it and that’s why Paxful was started. Bitcoin is a tool to make this happen. But Bitcoin is only the last peer-to-peer technology that we have. First, we have the internet and now we have everybody having a mobile phone. So, I intend to build the plumbing around this and mobilise the youth to make the money flow and that’s all we need to do.
From your feasibility assessment, what makes Nigeria attractive to you given especially given its infrastructure challenges including low internet penetration?
Well, the only feasibility study that really counts is to put your foot on the ground, come here and meet the people. You can read all the studies and reports about Africa and Nigeria…often, they have no idea what the story here is on the ground. When I actually came here and met the people and I spoke to them and allowed them to educate me, I was like wow, these people are amazing. They have the strength, energy, and vibrancy, and brains to make this happen. No other people in the world have the drive of the Nigerian people. I have never seen a youth like this and I have seen a lot of very impressive youth all around the world including Egypt where I am from. But there’s something special with extra spice with Nigeria, and we need that to make this happen because this is the money business and so I am here because of the people and I understand the power of the people anytime I talk to them.
Given the widespread poverty in Nigeria and Africa in general, how can bitcoin technology be a tool for the empowerment of the vulnerable population?
Clearly, the centralised money system in banks and the whole financial system has failed us through incompetence and also what I believe to be a system of punishment for the people in the global south. They kept the money from flowing and that’s why they keep us poor. They keep your money trapped in this global economy, they are basically in a prison and their money is in the prison and that’s how they kept us poor. Bitcoin is the last peer-to-peer technology we need to truly make money flow. Bitcoin allows us to disrupt the financial system in a good way by bringing the power of that to the people and the people just want the money to flow because they know that’s going to make everyone rich and that’s all. Bitcoin is the last peer-to-peer piece of the puzzle – that little component that we need to put into the engine and then we just need to introduce this to the youth and they will drive it all way home and that will destroy poverty.
For how long do you think monetary authorities around the world can continue to hold off on bitcoin adoption in view of the technology’s compelling benefits to society at large?
Well, the question is why are they resisting it? We get flimsy excuses like it’s money laundering and all that – these don’t hold water because bitcoin is transparent. So, why are they resisting it? To me there are a few reasons: number one, a lot of the people in power or who are very close to the central bank get a very favourable arbitrage; they can buy dollars at the official rate and sell them to the black market. So, they have a very lucrative trade out there.
The other reason is that there is a lot of uncertainty coming from the central bank but again, for this reason, I don’t blame the central bank and I don’t blame Nigeria because there is tremendous pressure coming from the outside and it is not only in Nigeria; it is in Egypt and every global south nation that has its own currency.
If the president of this country says I am tired of seeing half my youth unemployed and says I am going to put all of our people to work; build schools, roads, factory and put everyone work and make this country rich…the moment they do that, if they have the guts to do that, they will get a call from the IMF saying you can’t print up your money, you’ve got to borrow ours at interest or else, we will destroy the value of your currency and your market because we control price discovery. And that is the pressure, that is the gun that is being held to the head of every global south leader.
And because of those few things, they can resist bitcoin for some time but it is still happening and it is going to continue to happen and grow. So, the question is when is the tipping point? When Pan- Africa is able to send money across the countries using bitcoin, and when they notice that it is actually increasing the volume of the Naira in the country and that it is actually putting the people to work in this country. It puts the workforce here in Nigeria to work, earning hard currency in Dollars and Euros without hurting the exchange rate of the Naira. And that’s amazing; if I am the president of this country and I see that my population is being put to work and earning hard currency, I will see it as a huge opportunity.
How much can bitcoin do to strengthen the local currency?
It will contribute to the stabilisation of the local currency while putting young people to work. We also met the Central Bank of Egypt and told them the same thing – you don’t have to send all your young men out of the country. They can stay right here and maximise their potential using bitcoin. Nigerians don’t have to leave the country and now we have this opportunity, magical internet money that could cross the country.
And interestingly, there are some smart people in government who already see that but the question is when is that tipping point going to come? And what can we do with the youth to make it happen – and I wish I have the answers.
What is your oraganisation doing to boost the awareness of Nigerians about the bitcoin technology for their empowerment?
This is a great question. Education happens along multiple levels and I am very happy to say that at the very foundational level, we have built two schools in Kaduna State. We determined to build 1,300 schools worldwide and we’ve done 11 so far under the Built With Bitcoin (BWB) foundation initiative. That is one level and something that is very close to my heart.
And there is this Pax Nigeria, which is education for older people- those that can put things to practice right away; teaching them about what money actually is, where it comes from and how bitcoin is good honest money, and how they can use bitcoin to make money; how arbitrage opportunity exists and how crypto isn’t just speculation but a means of exchange, so, anyone can come here and even get the certification.
There is yet a growing skepticism over the genuineness of bitcoin, especially as a lawful trade that is free from fraud. How do you address this concern?
Absolutely, bitcoin is very real. I encourage Africans to be skeptical; because there are reasons to be skeptical and it keeps us healthy and safe. And the truth is that there had been a lot of scams like MMM, scams that have come from Russia, America, and Europe, and preyed upon Africans, especially Nigerians. And many have also put their money into crypto and lost. Now, there’s a lesson there – These scammers used cryptocurrency because the technology is superior and makes collecting money easy but you don’t have to use that application to scam or speculation. Technology is good, it makes sending and receiving money easy and we can use it as a means of exchange. And so, our money has no borders; it can travel around, move around and make us more money. Now, if you look at the Naira or whatever fiat currency we use in any country, it’s kind of trapped as a result of capital controls or you have issues with your bank…So, the technology works just like your cell phone. But we don’t have to start and put our life savings into it, you can start with N10, flip it, do arbitrage and turn it into N50 and you can build up from there. You don’t have to hold all your money in bitcoin, you can hold it in eNaira if you want; but the point is that it is your access card, your global financial passport and that is what is important. That is very real and no one can take that away from a person who controls bitcoin. Nobody can come to you and say you don’t have permission to use bitcoin again but they can do that with your bank.
