What Is The Blockchain, And What Could It Mean For Young South Africans?

When the blockchain began making waves in 2008, no one could have imagined the scale of its impact in the world. Few people will remember that Bitcoin was launched with a value of $0 in 2009 and took two years to reach $1. Back then, no one could have foreseen that it would be worth more than $69,000 in November 2021. While there has been a recent downturn - along with a number of other asset classes – it would be a mistake to overlook the immense potential that Web 3.0 holds for young South Africans.?

In order to understand the potential of web 3.0 tools, first we need to distinguish what Web3.0, NFTs, crypto and the blockchain are.

Simply stated, a blockchain is a system for recording transactions that is maintained across many computers around the world which are linked by a peer-to-peer network. Large numbers of individuals around the world verify these transactions, providing a check on each other should any one person try to corrupt a given transaction. These many verifications done by unrelated individuals across the world are just one of the layers that make a blockchain incorruptible. Perhaps no one in the world knows better than South Africans about the value of an incorruptible system of transactions.

NFTs are an application of the blockchain that is changing the very nature of what we can own and how we can own it. Using the blockchain, NFTs allow anyone to mint a token that represents ownership of an asset – tangible or not – in the real world. Because the contract governing the asset is recorded on the blockchain, it is immutable. What is also captured by the blockchain is the record of the transactions through which the asset has been transferred from one owner to another, making it relatively easy to trace the real holder of the token. These advantages speak to the known virtues of the blockchain, but the use of NFTs has added a dimension with revolutionary potential for young South Africans.

Minters of NFTs can not only record ownership of an asset on the blockchain, but also divide this ownership into several different tokens, making it easier for one asset to be owned by multiple people across the world – this process is known as fractionalisation. To see the magnitude of this innovation, consider real estate. Joint owners of a property normally have to go to the deeds office to register a property in their names jointly – an expensive and time-consuming task. But with NFTs, this transaction can be recorded in an incorruptible format in just ten minutes. Now, each owner can sell their token to someone else in minutes, no deeds office required. Finally, there is an affordable and easily transferable way for young people to invest in portions of previously inaccessible assets like land and houses – without incurring high legal and other transactional costs. Yet asset ownership is but one of the needs young South Africans have today. After all, to buy anything, one needs money.

Here too the blockchain is changing the way that young people can monetise their talents and skills. Last month, Momint launched a token that allows investors to provide funding for its YouTube content and earn a portion of the advertising revenue. The applications of this investment model are endless for the entrepreneurially minded. You can now raise funding to start a chisa nyama in Gugulethu or to put together a production for the Market Theatre in a matter of minutes by simply minting an NFT that you can sell to investors around the world in return for a slice of your profits.

There are however serious impediments to the ability of young South Africans to take advantage of the opportunities Web 3.0 presents. Perhaps the most important is the limited internet connectivity in some of the communities that stand to benefit most from these innovations. This is just one of the challenges that the government must address if South Africa is to play a significant role as a continental or even global leader in Web 3.0 innovation.

As the world retreats into fear and scepticism after the recent cryptocurrency crash, there will undoubtedly be an instinctive impulse to recoil from the uncertainty – but this is a mistake. With unemployment in South Africa at historic levels, and the economy seemingly unable to generate the growth we need to reverse this trend, young people have few choices but to take matters into their own hands. We need to evolve in our teaching from finding opportunities to creating opportunities, and no generation before us has been as well-equipped as we are today to do just that.?

Through Web 3.0, young South Africans can reach a global audience with their content, their products, and their causes. The is no limit to the fields in which we can apply these technologies – from taking our arts and culture to world and championing social causes, to property ownership and investment in alternative assets, the doors of opportunity are widening every day, promising a brighter future for millions of young South Africans in this next evolution of the internet age.

by Adam Romyn