Issue 2 | Why contributing to DAOs is a Great Opportunity for Africans | BanklessAfrica Newsletter
Issue 2 | Why contributing to DAOs is a Great Opportunity for Africans | BanklessAfrica Newsletter
This is BanklessAfrica Newsletter, a newsletter about staying up to date with well-curated news about crypto and Web3 around Africa.
Hey, BanklessAfrica fam!
Welcome to the second edition of the BanklessAfrica Newsletter!
We're so excited to be sending you this week's newsletter, and we hope you'll enjoy the new sections we've added.
We hope that this newsletter will help everyone stay up-to-date with what's happening in the world of Web3 in and around Africa.
We'd like to hear from you about how we can make it better — what do you want to see more of? What do you hope will be included? Comment below with your ideas.
Contributors : Yofi, Brandon, Cisco, Leah par, WinVerse, Abidemi, Trewkat
📈Historical Snapshots
As of May 21st, 2022
∘Top Assets by Market Cap
Name: Bitcoin (BTC) Price: $29,341.79 7d % : -3.14%
Market Cap: $558,909,446,429
∘ Biggest Gainers of the Week
Name: Nekocoin (NEKOS)
Price: $0.0...08688
7d %: +3940.60%
Volume (24hr): $1,480,511
∘ Biggest Losers of the Week
Name: ETH 2x Flexible Leverage Index
Price: $0.0
7d % : -100.00%
Volume (24hr): $1,907,910
👨🏿💻 Why contributing to DAOs is a Great Opportunity for Africans
Cover : Cisco Author: Yofi.
Introduction
Ever wondered why contributing to decentralised autonomous organizations, otherwise known as DAOs, is the best thing for Africans? Are you wondering how you can contribute to a DAO yet have no idea where to start? You're not alone. Blockchain technology, Web3, and crypto are new concepts to most people, which bring with them a steep learning curve. I will share some of my knowledge, experiences and perspectives on how Africans can improve their livelihoods via DAOs so that we can also benefit from this next innovation in the cryptocurrency space.
What are DAOs?
According to the Ethereum Foundation:
DAOs are an effective and safe way to work with like-minded folks around the globe.
Think of them like an internet-native business that's collectively owned and managed by its members. They have built-in treasuries that no one has the authority to access without the approval of the group. Decisions are governed by proposals and voting to ensure everyone in the organization has a voice.
There's no CEO who can authorize spending based on their own whims and no chance of a dodgy CFO manipulating the books. Everything is out in the open, and the rules around spending are baked into the DAO via its code.
Why Should Africans Contribute to DAOs?
DAOs are a revolutionary way to allocate resources and make decisions. They are a way for people to form a group that works towards a common goal.
DAOs Equalise Opportunities for Talent To Shine
DAOs bring back power into the hands of those who create value: It doesn't matter where you live or what language you speak — if you have something valuable to offer, you’ll likely find someone willing to pay you for it with crypto tokens or other crypto assets like governance tokens. You don't need permission from anyone to join a DAO, just like the Internet. This means that anyone can join or leave the network at any time.
Because DAOs are permissionless, anybody can literally just raise their hand and complete tasks. No one is going to ask you for a cv or anything.
Crypto is a great equalizer. This means anyone with an internet connection, irrespective of their background, appearance, or geographical location, can contribute. . Let's take advantage of it!
When I joined BanklessDAO I started with Instagram copywriting bounties. There is plenty of work to go around!
DAOs Help You Build and Work on Projects
DAOs help you build and work on projects.
You can be more creative and innovative in DAO work as they are an environment where people can come together to build something they care about. You can choose to work with other people with similar interests and goals. This makes DAOs ideal for individuals who want to use their skills or expertise in a group setting.
You can learn from other people's experiences. Someone who has never built a website before could join a DAO that is working on creating a website, for example, a charity organization. They would be able to learn from other members about web development, which could help them become better at what they do professionally.
I did just that! I didn't have to spend hours doing trial and error experiments. I learnt from the best newsletter writers and coordinators to spin up something similar.
Create Your Portfolio and Build a Reputation via Bounties
In DAOs, bounties are tasks that users can complete for payment in governance tokens. The most common type of bounty is note-taking during meetings.
By completing bounties, you will be able to gain experience in being an active contributor in the Web3 space, gain exposure for your work and create a strong portfolio of completed work.
You'll Learn a Lot
Some DAOs may be complicated and difficult to understand at first. They're also the future of decentralized governance. If you want to be able to participate in the DAO economy, you need to learn how they work. You won't get into Harvard Law School overnight; you have to earn it. The same applies here, but instead of studying for years, you can enter an awesome community of like-minded people who are all trying to help each other.
So many projects need help and support, so there's no shortage of opportunities for you to learn and grow as a contributor, intrapreneur, entrepreneur, or investor. My head is literally in flames every day (okay, not literally!). There is soo much innovation going on, and it's sometimes challenging to keep up.
You’ll Be Contributing to a Fast-paced Environment
The DAO is not an organization that operates at the speed of African governments. It's an organization that operates at the speed of innovation. This means that you'll need to be comfortable with constantly changing priorities, working in an environment where there is no one-size-fits-all solution and being agile enough to adapt quickly when necessary.
Disadvantages To Keep In Mind
As a new form of organization, DAOs are still very much in their infancy. Though they represent an important innovation in how we work together, they also present several challenges that need to be addressed.
DAOs have many advantages but also some disadvantages that need to be considered when deciding whether or not to participate. The following are some of the main issues with DAOs:
No Legal Recourse.
If a DAO's smart contract is poorly written, or if it's hacked, there is no way for investors or participants to seek redress in court. This is a problem that applies to all cryptocurrencies, but it's especially relevant when it comes to DAOs because they often have very complex smart contracts behind them.
Volatile Industry Based on Market Cycles
The crypto market is volatile. It can be hard to predict what will happen next and whether governance tokens will be worth it in the future.
Volatility makes it difficult for DAOs and DAO contributors to plan ahead and make long-term decisions. Volatility also means that DAOs contributors cannot rely only on their holdings as a source of income or passive income. However, if you are bullish and in it for the long haul, there is nothing to worry about.
You Are Responsible for Your Security
You are responsible for your security. DAOs are designed to be autonomous and self-sustaining, but they still require humans to operate them. You can't just set up a DAO and throw money at it; you have to actively participate in it by voting on proposals. That means that if you are part of a DAO and use a cryptocurrency wallet, you need to make sure that your computer is secure and can't be hacked or compromised. If someone steals your private key and gets access to your funds, there's nothing anyone can do about it because there's no way to reverse blockchain transactions once they're made. There is no central authority to report this kind of theft and get your money back. You're on your own! A painful lesson I had to learn. sobs
Tips for Better Contributing to a DAO
Contributing to a Decentralized Autonomous Organization (DAO) is very similar to contributing to a traditional organization. However, there are some specific things you need to consider when contributing to a DAO.
Here's my list of tips for better contributing to a DAO:
Know what the DAO does and why it exists.
Look at its governance mechanisms and how they work.
Look at the team involved in its creation and development and their level of experience with projects like this one.
Read the documentation and look at the codebase if possible (if it is open source).
Lurk a little.
Contribute!
DAO skills needed
According to two-plus, these are the top skills DAO contributors need:
Mental Fitness
This is how one can develop mental fitness.
Meditation, breath work, active resting, stimulating gratitude/compassion, physical health including daylight, exercise, sleep, and food.
Self-Direction
This is defined by your goals and values.
Facilitation
The DAO facilitation layer encompasses the skills, tools or applications that a DAO contributor should gain experience with to make collaboration happen .
This includes:
Decision Making
Relationships
Communications
Project Management and Working Groups
Operations
Contrary to popular belief, Web3 isn't made up of only programmers and developers. There is also a huge demand for community managers, project managers, marketers, copywriters, editors, designers and researchers/analysts.
Contributing to DAOs is clearly beneficial to the contributors themselves. However, as we have shown above, there are many other benefits that could trickle down more broadly for the whole African society. The next few years will be crucial for understanding whether or not DAOs will take off in Africa and, by doing so, improve the lives of millions.
📰 News and Opinion In and Around Africa
Is Africa’s Digital Economy Ready For Web3?
Author: Eric Osiakwan, CIO Africa.
Although some African leaders continue to pursue unfriendly crypto and Web3 policies, there are some friendly policies and strategies, which along with increased internet connectivity quality and growth of the mobile economy have contributed to the continent’s digital economy. For example, in Ethiopia, the government has partnered with the Cardano blockchain platform to give students and teachers the opportunity to create a blockchain-based digital identity.
The article quotes a GSMA report which states that Africa’s digital economy contributed 8% of the continent’s GDP in 2020. The article’s author estimates this will grow to be 25% of GDP by 2025 and 50% by 2050. If so, this will serve as a major catalyst for the continent’s Web3 adoption.
Various African industries across e-commerce, fintech, transportation, healthtech, VC and the creator economy have piggybacked off the continent’s ever increasing access to the internet and the digital economy by building and investing in internet=enabled businesses.
How Fintech and Crypto Are Boosting Africa’s Burgeoning Tech Scene
Author: Cryptogain
Since the Central African Republic’s adoption of bitcoin as a legal tender in April, many crypto natives and regulators have speculated on how the decision could affect or improve the country's economy. One key area that’s not been considered is whether it can significantly help fintechs reach the country’s unbanked. The article states that at present, only a very small proportion (4%) of the nation’s population has internet connectivity. Together with a similarly low level of access to electricity this could hamper mining and trading of bitcoin.
FTX Africa and Web3Ladies Collaborate on the #WomenWhoCrypto Campaign to Drive Crypto Adoption Through Education
Author: Vanguard
On May 4, 2022, global cryptocurrency exchange, FTX, and Web3Ladies announced a partnership to collaborate on a new campaign called #WomenWhoCrypto. This campaign is geared towards onboarding African women into the cryptosystem via education.
Adebayo Juwon, the Business Development Manager of FTX in Africa, and Oluichi Enebeli, the founder of Web3Ladies, both expressed their delight and excitement about the campaign and are looking to develop the blockchain skills of a new generation of female leaders.
A co-hosted weekly Twitter Spaces event will aim to educate young African women about the opportunities available across Web3 and how best to take advantage of these.
Why the Time Is Right for Web3 in Africa
Author: Kevin Imani
Late adoption of internet technology has been one major challenge for Africa in recent decades, but Web3 is something totally different.
Rapid growth in the adoption of crypto during 2020 and 2021 saw six countries listed in 2021’s top 20 Global Crypto Adoption Index, as adoption across the continent skyrocketed by over one thousand percent.
With startups offering blockchain solutions, companies partnering with leading blockchain networks like NEAR Protocol, and fundraising for crypto services, we can truly say that the time is right for Web3 in Africa.
Although we have quite a number of challenges in the space, they are issues we will definitely overcome in the coming years. Through education and blockchain development, we can come up with better solutions and get things to a more sustainable place.
Crypto Can Complement Mobile Money in Africa, Top Banker Says
Author: Tech Central South Africa
A good number of Africa’s central banks remain sceptical about the idea of trading cryptocurrency. While the Central Africa Republic remains the only African nation to decide to adopt bitcoin as legal tender , the South African Reserve Bank will at least formulate rules to protect crypto investors.
CEO of the Kenyan-based lender Equity Group Holdings,, James Mwangi, announced his belief in cryptocurrency at the recent Bloomberg Invest: Focus on Africa conference. He explained that Africa could benefit from taking advantage of so-called Fourth Industrial technologies like cryptocurrency, which can complement mobile money in Africa, supposing regulators can be convinced of the benefit. "We are hoping that the use of technology, particularly data and artificial intelligence will be a major basis of leapfrogging because we are not talking about existing manufacturing capacity, we are starting afresh," he stated.
How NFTs Have Empowered Artists in African Art Scenes
Author: Ugonna-Ora Owoh
Initially, there were few chances for digital artists in Africa to make artworks and get them sold. Most artists had to live by creating artworks for companies or clients that required their services.
However, since the inception of NFTs, we have seen quite a number of African artists step into the limelight.
Artists who had little hope of getting recognized for their work, have suddenly become the talk of the market because of the demand for new and exciting stories of African culture told through their art. .
South Africa, Kenya, Nigeria, and Ethiopia are among the countries where NFTs have been embraced, with communities of practice forming around production using the new technology. Although the market is still very young, it is a glimmer of hope for digital artists in Africa.
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💹 DeFi Degen Corner
Is GMX the Best Yield Play at the Moment?
Author: Brandon k
Yield farming during a bull market is easy. Super high protocol inflation is just eaten up by huge buy demand and high APRs keep churning and you start to dream of retiring on that passive income. A bear market, on the other hand, is brutal on farms. High inflation outpaces any buy pressure and the number goes down. Your initial LP position gets wrecked as well and your dreams of passive income fade.
There is good news though. During a bear market fundamentally strong projects show their strength. The holy grail of a good farm is a protocol that pays you out of revenue, not inflation.
This week I'm going to show you how to earn a respectable yield in ETH on the GMX protocol.
GMX is a platform for traders to use decentralized perpetuals. Degens love leverage and centralized exchanges have been milking it off the fees. These could be potentially gigantic protocols soon. Bitcoin perpetual futures hit record open interest in 2021, with average volumes of ~62B USD per day. Okay, so now we know there is a market fit.
In my opinion, GMX is a cash cow. It has already generated over 53M USD in fees since its launch in September 2021. This is for a protocol with a market cap of only 140M USD
So what is the degen play here? Remember the yield is paid from revenue so this token is not going to have your typical farm token dump. You want this token. During a bull market you could just stake the GMX token and earn a 36% yield, Around 18% of that is paid in ETH and the remainder in escrowed GMX (esGMX), but for the more conservative bear play, they have another token of sorts. It’s called GLP and is actually more of an index fund, made up of 50% in stablecoins and the remainder in predominantly ETH, BTC and a small allocation to LINK and UNI. All blue chips that we are mostly comfortable holding, especially when paired with a stablecoin that keeps its peg.
As you can see it’s 30% ETH, 30% BTC, 3% LINK, 40% USDC, 3% USDT, 5% DAI
Through GLP you are effectively providing liquidity for traders to trade spot and futures. 70% of all the fees from interest and liquidations go to you. The other 30% goes to the GMX stakers.
One downside is that you are also the liquidity for successful trades where the treasury takes a hit but luckily for us, humans are mostly terrible traders.
Traders overall are net down close to 15M USD on Arbitrum alone. The house normally wins.
The price of GLP has consistently been hovering around 90 cents USD. The yield is a solid 31.6% in ETH plus 12.79% in esGMX. That’s a 44.46% yield, mostly in ETH! Note, the esGMX needs to be vested over a year, or you can just stake it and earn more ETH.
The other good news is that the GMX exchange is available on Arbitrum and AVAX. It’s been ranked extremely highly for its tokenomics with only 2.5% going to the team and no VC’s to dump tokens on you.
Downsides include the fact that the team is not doxxed and thrives when a lot of trades occur, and as always there is smart contract risk and risk of impermanent loss.
Disclaimer: I am a holder of GMX and GLP.
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