Kenya’s Young Entrepreneurs Network (YEN) developed a new, unusual stablecoin called YENTS which is now under the inspection of the local regulatory sandbox in Nairobi.
Members of YEN are expecting to launch it in November 2020 and their new token will be tied to the Kenyan shilling.
According to the AfricaReport, young Kenyan entrepreneurs are trying to build a golf course with the help of Blockchain and their stablecoin which is backed by the real currency.
Using this unusual coin, people can take part in sports activities or training, but the main aim of the organizer is to allow investment in a planned golf course in Kenya, as people can pay with YENTS stablecoin for participation in some sports activities. But the initiative still needs to be approved by Kenyan regulators.
As the network’s CEO Kamau Nyabwengi says, YENTS will be used not only in Kenya but in other African countries, as well. He believes that crypto regulations in Africa still need some improvement if investors want to be aware of the stablecoin’s full potential. Developing stricter regulations will help Nairobi’s economy to capitalize on the benefits introduced via this new technology. Indeed, experts bet that YENTS stablecoin has the potential of normalizing access to the financial market.
Importance of pan-African regulations
However, there are many complexities that only country-wide regulations can bring to financial companies. There is no point in using this new currency only in Kenya as it means suppressing its full potential and denigration of the initial plan of the CEO.
For example, Forex brokers that follow Kenya’s regulations are very limited in the business models they can adopt. An Africa-wide regulation that is in place in some sorts for traditional finance is much more forgiving. The effective solution for this problem would be developing a unified regulatory approach for the whole continent of Africa which is often referred to as pan-African Blockchain strategy.
Approaching a consensus on regulatory goals will lead to harmony and congruity of data protection rules. Nyabwengi believes that developing this kind of pan-African regulations is essential and realizing the full potential of the Blockchain will be impossible without spreading the regulations throughout the continent.
Despite the fact that there are many obstacles to implementing this intra-regional agreement, Financial Times seems hopeful about the international institutionalization of blockchain strategy and believes that Africa will take a big step forwards and overcomes economic problems concerning continent-wide trading.
The same thing can happen to cryptocurrencies. The recent research of Chainalysis shows that there is an increasing tendency of cryptocurrency adoption all over the world and Kenya is ranked fifth in the world, followed by the USA which is a surprise. In general, the study found out that cryptocurrency activity is truly global, and developing countries have higher levels of crypto activity, where P2P platforms are essential to adoption.
But some experts think that harsh regulations suppress innovation within the crypto sector in Africa and it’s completely possible that cryptos will face the same issue as Kenyan stablecoin.
To sum up the news, the Young Entrepreneurs project was a big step forward, and making a stable digital currency that is backed by the Kenyan shilling or US dollar was essential for implementing innovations in the Kenyan economic market. However, Africa truly needs a more coordinated approach to blockchain regulation.
This current plan is still waiting for approval from African regulators and as the CEO Nyabwengi says, regulations must be improved to fully implement this new coin for financial services and realize it’s full potential. However, there are still many crucial details that need to be worked out.