The CEO and co-founder of neobank Canza Finance claims that utilizing Baki for foreign exchange trades in Africa creates a hub for African businesses to participate in intra-African and FX trades at a reduced cost.
Forex liquidity and currency swaps are hard to access for many in Africa, which limits the use of United States dollar-based services in the continent’s import-dependent economies. This creates a vacuum that decentralized finance (DeFi) could solve, leveraging cryptocurrencies, blockchain networks and services, according to the CEO of Canza Finance, Pascal Ntsama IV.
Speaking with Cointelegraph, the CEO and co-founder of Canza Finance — a neobank enabling decentralized cross-border payments for Africans — said that Canza’s new DeFi technology, Baki, aims to address this challenge by providing decentralized foreign exchange (FX) for African currencies, enabling slippage-free swaps at central bank rates.
When exchanging local African fiat currencies, funds exit Africa, causing inflation in the dollar value and increased costs due to currency slippages.
DeFi in Africa is projected to show an annual growth rate of 21.99% and reach over half a million users by 2027.
In response to whether Baki’s services would work in countries like Nigeria, where blockchain technology has yet to be broadly adopted even after approval, Ntsama said Baki is built to work with the current regulatory climate as it leverages existing user behaviors to tackle problems with blockchain technology.
Related: Kenyan lawmakers ask local Blockchain Association to come up with crypto bill