Bitcoin is introduced into Africa's largest slum, with risks and rewards
[June 09, 2025] By
JACK DENTON and MOSES NDUNGU
KIBERA, Kenya (AP) — Dotting the roadside in what is widely considered
Africa’s largest urban slum are typical stands selling vegetables. What
isn't typical is their acceptance of bitcoin as a form of payment.
Around 200 people use bitcoin in Soweto West, a neighborhood of the
Kibera slum in Kenya 's capital. It's part of an initiative to extend
financial services to one of the country's poorest and most under-banked
areas.
Its promoters say the adoption of crypto fits with the ideals of bitcoin
as an accessible, democratic technology — but experts say it also has
major risks.
Bitcoin came to Soweto West via AfriBit Africa, a Kenyan fintech
company, through its nonprofit initiative to improve financial
inclusion.
“In many cases, people in Kibera do not have an opportunity to secure
their lives with normal savings,” said AfriBit Africa co-founder Ronnie
Mdawida, a former community worker. With bitcoin, "they do not need
documentation to have a bank account … that gives them the foundation
for financial freedom.”
Bitcoin, the first and largest crypto, was created in 2009 in the wake
of the global financial crisis as a decentralized digital asset that
could act as an alternative method of payment.
The asset has found more popular use as a store of value, like a digital
form of gold. Bitcoin has attracted enthusiastic supporters as prices
have climbed almost 1,000% in the last five years. But its volatility
and lack of regulation are concerns.
AfriBit Africa introduced bitcoin into Soweto West in early 2022 through
crypto-denominated grants to local garbage collectors, who are often
funded by nonprofits. The groups are made up of dozens of young people,
who Mdawida says are more likely to be open to new tech.
After gathering on a Sunday to collect trash, garbage collectors are
paid a few dollars' worth of bitcoin. AfriBit Africa estimates that it
has put some $10,000 into the community, with garbage collectors acting
as the main agents of spreading bitcoin in Soweto West. In Kibera, many
people earn about a dollar a day.
Now a small number of other residents hold bitcoin, and some merchants
and motorcycle taxis accept payments in crypto.
Damiano Magak, 23, a garbage collector and food seller, said he prefers
bitcoin to M-PESA, the ubiquitous mobile money platform in Kenya,
because M-PESA transaction costs are higher and the network can be
slower.
There are no fees for M-PESA transactions between individuals or
businesses up to 100 Kenyan shillings (78 cents), but after that the
fees increase with transaction size. Fees for the Lightning bitcoin
network where transactions take place are free if people use a platform
that AfriBit Africa introduced into the community.
Onesmus Many, 30, another garbage collector, said he feels safer with
his money in a bitcoin wallet instead of in cash because of crime.
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Members of the Livegreat Foundation who engage in waste management
display their bitcoin wallets and QR codes in their mobile phones as
they receive payments using bitcoin after a cleanup exercise at
Kibera Slums in Nairobi, Kenya, Sunday, May 4, 2025. (AP
Photo/Andrew Kasuku)
 Some merchants have found benefits
to accepting crypto, including Dotea Anyim. She said around 10% of
customers at her vegetable stand pay in bitcoin.
“I like it because it is cheap and fast and doesn’t have any
transaction costs,” she says. “When people pay using bitcoin, I save
that money and use cash to restock vegetables.”
The possibility that crypto prices could keep rising also appeals to
residents of Soweto West. Magak and Many said they now have around
70% to 80% of their net worth in bitcoin, a far higher level of
exposure than most people.
“It is my worth and I’m risking it in bitcoin,” Magak said.
That concerns Ali Hussein Kassim, a fintech entrepreneur and chair
of the FinTech Alliance in Kenya.
“In an extremely volatile asset like bitcoin, it’s overexposure. I
can’t afford to lose 80% of my wealth. How about a guy in Kibera?”
Kassim said. “You are exposing a vulnerable community to an
ecosystem and to financial services that they can’t necessarily
afford to play in.”
Kassim acknowledged the potential benefits that digital assets could
bring, particularly in facilitating cheaper cross-border payments
like remittances, but failed to see the benefit in Kibera.
Bitcoin’s volatility could negate the benefits of cheaper
transaction fees, Kassim said, and bitcoin does not have the same
protections as other financial services due to a lack of regulation.
Mdawida disagreed, calling bitcoin’s unregulated nature a benefit.
“We don’t shy away from the risks involved,” the AfriBit Africa
co-founder said, noting the group’s investments in bitcoin education
in Kibera, including financial literacy training and crypto courses
in the community.
Efforts to introduce bitcoin into developing countries have faced
challenges. Bitcoin was adopted as legal tender in El Salvador and
Central African Republic but both countries have reversed their
decision.
In Kenya, the digital asset sector has faced legal and regulatory
challenges, including crackdowns on cryptocurrency giveaways. This
small project, focusing only on Soweto West, has been allowed.
“On my phone I put notifications on when bitcoin rises … and it’s
all smiles," Magak said. "Whenever it fluctuates up and down, I know
at the end of the day it will just rise.”
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