Can a digital token really create the economic equality promised on a continent still wrestling with legacy financial disparities? That’s the question flying around XRP and its ambitions to change Africa. So can it, I believe, but only if we face the challenges head-on and commit to responsible implementation.
Financial Inclusion: A Real Possibility?
Let’s face it, the established financial ecosystem has, for all intents and purposes, abandoned a vast segment of the African populace. NOT HAVING THE TIME OR MONEY High transaction fees, slow processing times, and limited access to banking services are daily realities. This isn’t just a matter of convenience, this is a matter of economic opportunity. Think of that small business owner in Kenya. They find it impossible to import goods because of exorbitant fees and maddening delays that eat away at their bottom line. Or a diaspora family back home whose support comes through the diaspora and suddenly losing about a third of their incomes to high transfer fees.
XRP, with its instant and practically-free transactions, look really attractive. Ripple Payments employs XRP as a bridge currency to significantly cut expense. Now this second innovation, real-time settlement, is something that benefits everyone, and really gives power to the people—and businesses too. Even the fact that transaction fees begin at 0.000001 XRP is jaw-dropping when compared with traditional banking fees.
Here's the catch: technology alone isn't a silver bullet. Infrastructure, education, and regulation are crucial. We need to ensure that Africans have access to the internet and the digital literacy skills necessary to use these technologies effectively. In addition, it is important that responsible regulation be put in place to protect consumers from fraud and exploitation.
Beyond Remittances: Empowering Entrepreneurs
The potential of XRP goes way beyond remittances. Now think about the second order effects for all the entrepreneurs, Mom-and-Pop businesses, and innovators. In reality, access to global markets is often hindered by complex, expensive payment systems. XRP could streamline these transactions, allowing African businesses to compete on a more level playing field.
Consider the example of a craftsperson in Ghana who wants to sell her goods through e-commerce. In fact, it is a nightmare for any of their non-US customers to receive payments – rife with predatory fees and time consuming delays. Furthermore, XRP would allow enterprises a fast, low-cost option for payment receipt, facilitating access to previously unreachable markets and customers.
Ripple’s expansion into the tokenization of real-world assets (RWAs) ⬅️ I know, I know this piece is already packed with great news! Just think about tokenizing assets like physical gold or treasury bills. This innovation could open up these investments to a dramatically wider class of investors! This has the potential to open up entirely new pools of capital, equitably generated from African businesses and individuals.
This requires careful consideration. We don’t want to repeat the mistakes of previous externally imposed “solutions” on the continent. This isn't about simply transplanting Western technology. It's about adapting it to the specific needs and contexts of the African continent.
Navigating Centralization & Regulatory Hurdles
Critics still point to Ripple Labs’ huge holdings of XRP. In doing so, they highlight the company’s control over the Unique Node List (UNL) of validators. It’s not difficult to imagine, then, how such a system could be manipulated and controlled to suppress dissent.
Ripple goes for something called “permissioned decentralization,” focused on enticing regulated institutions. This flexible, forward-focused approach recognizes and accommodates the benefits of decentralization while addressing the importance of compliance and security. It’s a big compromise, but maybe one that’s needed to find broader buy-in.
The SEC lawsuit is another major hurdle. Though the ruling in July 2023 offered a measure of clarity, the legal fight is only beginning. How these legal actions play out will be critically important in determining the fate of XRP. It may play a role in how quickly (and widely) XRP gets adopted across Africa.
The joint motion to settle on June 12, 2025, calls for a divided civil penalty. This would be a welcome move in the right direction toward clarifying these ambiguities. Without a clear regulatory framework, it will be difficult to foster the level of trust needed to spur investment.
The internet, originally intended for military communication, has connected our communities and transformed how we do business. Similarly, XRP, despite its initial controversies, could evolve into a powerful tool for financial inclusion, but only if guided by ethical considerations and a commitment to empowering local communities.
The future is not set in stone. The responsibility is an urgent one. We, the users, developers and regulators of this technology all have a critical responsibility. Join us in creating a future for cryptocurrency that welcomes all, particularly those who have long been denied access to our financial system.
I urge you to delve deeper into Ripple's technology, explore its potential benefits, and advocate for policies that promote financial inclusion and responsible innovation in Africa. The future of finance is still being determined today. Now, it’s purely our choice to build a future that leaves no one behind.
