ZEC UBI Fund® - Africa

Hi All

My names Tadii , Founder of BitFlex FinTech and like everyone here, a ZEC Enthusiast🛡️& Miner!

At BitFlex, we focus on Universal Basic Income (UBI) & Financial Inclusion In Africa, namely Zimbabwe. www.bitflex.app

With the current economical crisis and hyper-inflation, i believe crypto could save Zimbabwe and one day similar to El Salvador, detach itself from the traditional finance system and enable financial freedom and prosperity for its people through crypto.

I believe we can achieve this with a ZEC UBI Fund®

You can read more about hyper-inflation in Zimbabwe below:

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Can you please explain the reason for posting this? Are you seeking donations or funding?

Please provide better details.

Hi @Shawn

We are looking to work with the ZOMG on this project.

We would like to create a UBI Fund for vulnerable communities in Africa (Zimbabwe) that leverages DeFi.

Just to give you a brief of who we are:

My name is Tadii Tendayi, im the Founder or BitFlex FinTech®

and the Chairman of United Africa Blockchain Association UABA (Zimbabwe)

We are part of the Celo Alliance for Prosperity

We are working closely with Celo to improve access to digital assets in Zimbabwe and setting up CICO® Kiosks around the country.

We are also partnered with:

As ZEC supporters, followers and Miners, we believe this would be a great fit as we have won grants from Celo ,Polygon and GoodDollar on the same mission of Prosperity for All.

We are seeking Funding to set up a ZEC UBI Fund® which would focus on vulnerable communities where beneficiaries can claim funds through an app with no intermediaries.

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Welcome to the Zcash forums!

I’d love to learn more about this. If I understand correctly, it sounds like you are working on a program that would distribute ZEC to a set of recipients for them to use in any manner of their choosing, correct?

Please keep in mind that I work for Electric Coin Company and am unrelated to ZOMG or the grant selection process. These questions are from my own curiosity. Also, I am very unfamiliar with Zimbabwe generally, as well as the state of crypto there, so any context you provide would be very helpful for me.

  • How would the recipients be selected?
  • How long would the program run?
  • How will success or failure be evaluated throughout the program or upon completion?
  • What options would exist for those recipients to use their ZEC?
  • What other crypto assets would be distributed by this program, and how does the program select and acquire those assets?
  • Do recipients choose which assets to receive, or do they receive a bundle of many different assets, or do different groups of recipients receive different assets?
  • Does the program train recipients about crypto custody, such as how to use a wallet, safely store their backup seeds, and so on?
  • How familiar are recipients with crypto already? What challenges exist for training recipients around usability and crypto concepts?
  • Does this program integrate general financial concept and skills training, such as budget or investment training?
  • Would this program engage specifically with merchants or service providers or would it focus solely on UBI recipients?
  • Would this program have any relationship or interaction with the government of Zimbabwe or local government bodies?
  • Does the program have relationships with anyone in the field of developmental economics or general economics policy experts?
  • Will the program use econometrics or any other kind of empirical evaluation methodologies?
  • Would the program provide any direct technological services or products to users, or would it rely completely on pre-existing services and products? The reason I ask is from seeing the example of El Salvador government developing and distributed its own wallet.
  • Beyond receiving assets like ZEC itself, what other help or needs does this program have from the broader crypto industry and/or the Zcash community?

Thank you for your effort on this kind of program. If done well, I am hopeful it could make a great impact.

regards,
Nate

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Hi Nathan

Thanks for the warm welcome!

To answer your questions respectively please see below:

If I understand correctly, it sounds like you are working on a program that would distribute ZEC to a set of recipients for them to use in any manner of their choosing, correct?

Yes this is correct, Beneficiaries can use ZEC in any manner they want… its "Unconditional"

  • How would the recipients be selected?

Beneficiaries are selected through existing communities we care about, for example our 1st community we support is a community of vulnerable women with Endometriosis. The Community is called Zimbabwe Endometriosis Support Network (ZESN) This community has over 100 Women who are living with Endometriosis.

  • How long would the program run?

The program typically runs continuously, this is because we leverage DeFi to generate funds to support these communities there is not really an end date , its more-so about adding more beneficiaries to the community as we compound the earnings from the Yield Farms and Liquidity Mining Pools.

  • How will success or failure be evaluated throughout the program or upon completion?

We use a live page designed with to update the daily earnings from the Yield Farming / Liquidity Mining (See Below)

  • What options would exist for those recipients to use their ZEC?

- Beneficiaries will be able to Swap their ZEC for USD Cash or Local Currency Mobile Money at a BitFlex CICO® Kiosk (See below)

  • What other crypto assets would be distributed by this program, and how does the program select and acquire those assets?

As Zimbabwe uses the USD as a secondary currency, we would focus on USDT (on Polygon) and cUSD. We already Yield Farm UBE on Ubeswap which is Celo’s DEX and swap that for cUSD (Celo Dollar) which is then deposited into the UBI FUND® Wallet daily at 10:00am for distribution.

  • Do recipients choose which assets to receive, or do they receive a bundle of many different assets, or do different groups of recipients receive different assets?

- Currently No, Beneficiaries receive cUSD which they can swap for USD Cash or Mobile Money. Most of our beneficiaries need to use the money to purchase goods, i.e Food etc, However we’re working on setting up a small Local Store that accepts crypto.

  • Does the program train recipients about crypto custody, such as how to use a wallet, safely store their backup seeds, and so on?

- Yes, we have a live session with Beneficiaries before they start receiving their daily claim. And we emphasize the importance of storing your private key in a safe place. We actually just had a beneficiary who lost her phone and was able to restore her wallet successfully.

- We have also partnered with Shift Crypto - which offers tools to safely store account keys. you can read the article here: CRYPTO SECURITY: BitFlex FinTech X ShiftCrypto Security | by BitFlex FinTech | Medium

  • How familiar are recipients with crypto already? What challenges exist for training recipients around usability and crypto concepts?

- Crypto is relatively new in Africa but is gaining traction due to the economical crisis on the continent and in the country. We run workshops which educate users on the benefits of crypto, however like anything else in its infancy, people want the easiest learn about crypto and we believe in practicality. i.e Host incentivized workshops. We just finished in partnership with Celo where we taught people how to use DeFi on Celo. That went pretty well and had a turn out of 500+ learners. These numbers are growing as crypto begins to be spoken about by mainstream media.

  • Does this program integrate general financial concept and skills training, such as budget or investment training?

- Yes, we are working with financial advisors to come up with investment strategies that can help beneficiaries grow their portfolios. i.e keep 50% in crypto in a yield earning wallet like Nexo or YouHodler and swap 50% for Cash for daily expenses.

  • Would this program engage specifically with merchants or service providers or would it focus solely on UBI recipients?

- We are working on partnering with Merchants & Service Providers as i mentioned earlier, we are working with a Service Provider to swap Crypto for Mobile Minutes. This is a work in progress as most service providers and merchants prefer stablecoins which can be swapped at 1:1.

  • Would this program have any relationship or interaction with the government of Zimbabwe or local government bodies?

- This is an independent program however, it does have support from the ministry of education and financial institutions and the regulator such as the Securities & Exchange Commission of Zimbabwe (S.E.C.Z)

  • Does the program have relationships with anyone in the field of developmental economics or general economics policy experts?

- We are working with Policy Experts from Celo as they are also focused on CBDCs

  • Will the program use econometrics or any other kind of empirical evaluation methodologies?

- As we focus on DeFi, we use the same methodologies from the Yield Farms and break it down based on the number of beneficiaries.

  • Would the program provide any direct technological services or products to users, or would it rely completely on pre-existing services and products? The reason I ask is from seeing the example of El Salvador government developing and distributed its own wallet.

- Yes We plan to Develop a Wallet specifically for Beneficiaries and/or use the existing wallets that accept Stablecoins we utilize.

  • Beyond receiving assets like ZEC itself, what other help or needs does this program have from the broader crypto industry and/or the Zcash community?

- The program needs a unified support system push from leaders of all the Blockchain Protocols to come together As mentioned earlier, we’re already working with Polygon, Celo and GoodDollar on the same mission, however, the idea is to create a Universal Blockchain Social Responsibility | BSR® Group to develop a Universal Cross-Chain Fund + Wallet that leverages DeFi and distributes UBI to everyone around the world starting with emerging markets. (A mammoth of a Task i know) but i believe it can be done.

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Welcome to the forum @BitFlexJack

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@BitFlexJack, I’d like to first start by saying kudos to you and your team for working towards addressing some very serious issues facing the African continent. Your goals are very close to my heart.

I have two questions and they are both related to transparency. How do you intend to account for fund distribution? Will there be a system that ascertains to donors/grantors that the funds they contributed were indeed used to help address the issues vulnerable communities face in Africa, and more specifically Zimbabwe? How will donors or grantors be assured that the funds will not be misappropriated?

My next question: can you direct us to resources that indicate that these partnerships are in fact true? I saw that Celo did announce your partnership. But I looked for the Polygon announcement and could not see them announce any partnership or grants to this organization. (Polygon is generally very on top of their partnership announcements, it’s part of their growth strategy.) And then I also could not see any grant from Celo to your organization, just a partnership.

I then can see that you incorporated in Zimbabwe, UK and South Africa. Might be a good idea to have these documents somewhere on your website.

One more question actually. Given there is a major knowledge gap when it comes to crypto in Africa, is there a strategy for deploying this UBI Fund? For example will there first be a mandatory educational phase, before distributing funds?

Best,

Winfred

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I might disagree with this approach. And here’s why… if you give someone who is not financially literate funds, regardless of their needs, there is a likelihood the funds will not be used for the right reasons. I find it hard to believe that one class before distributing funds would suffice to educate them about crypto, storage of their crypto and prioritization of funds.

What would be neat, is maybe BitFlex partners with specific vendors that address the specific basic needs of these vulnerable communities so that whatever funds they receive, go towards meeting those basic needs and only those basic needs (food, shelter, clothing, education). So partnerships with grocery stores, schools, bookstores, retail stores etc to accept their crypto

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Hi @Winfred

Thanks for the warm welcome!

Please find answers respectively…

How do you intend to account for fund distribution? Will there be a system that ascertains to donors/grantors that the funds they contributed were indeed used to help address the issues vulnerable communities face in Africa, and more specifically Zimbabwe? How will donors or grantors be assured that the funds will not be misappropriated?

We work with existing communities, for example with the women with Endometriosis, the funds are used to pay for medication and/or consultations. We are working on a system that links the funds to specific vendors related to that community, i.e doctors and pharmacies.

can you direct us to resources that indicate that these partnerships are in fact true? I saw that Celo did announce your partnership. But I looked for the Polygon announcement and could not see them announce any partnership or grants to this organization. (Polygon is generally very on top of their partnership announcements, it’s part of their growth strategy.) And then I also could not see any grant from Celo to your organization, just a partnership.

They will be announced soon. With Polygon, grantees have to actually submit an announcement. We have not submitted ours yet but will do so.

I then can see that you incorporated in Zimbabwe, UK and South Africa. Might be a good idea to have these documents somewhere on your website.

Sure, thats a great idea, we can arrange this…

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I agree, this reminds me of the Lao Tsu saying:

if you give a hungry man a fish , you feed him for a day , but if you teach him how to fish , you feed him for a lifetime.

This is something we are working towards, however, we have to keep in mind that crypto is not as widely accepted as we would want. There are a lot of hurdles we have to get over in order for example, a school to accept crypto. This also then raises the Tax factor for the school, and transparency aspect. The crypto system is not as simple as we may want it, the infrastructure needs to be developed to bridge the gap and still remain compliant.

Schools, bookstores and retail stores need to pay Taxes, and accepting crypto without a way of accounting for the crypto received creates a grey area in reporting revenue and profits. Yes, there are Crypto accounting services, but it’s about getting these places to actually accept the crypto in the 1st place while still remaining compliant.

For someone, who is already into crypto, it’s easy to understand and grasp, but for the layman individual & business, we are introducing a completely new way of transacting which takes time and will face a lot of resistance.

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I was reading about the crypto situation in Zimbabwe earlier this morning - seems Mthuli Ncube as finance minister might have some advantages as he has a positive outlook on crypto. But I agree that that regulatory framework will take time to be developed.

How would you link these funds to specific vendors (pharmacies and doctors ) if you give cash to the community and they can spend it however and wherever they want?

Would the operation of BitFlex be compliant with existing legislations in Zim?

I ask these questions, not because I’m questioning your work. I really admire what you guys are doing and will continue to follow out of personal interest. I do feel though that there might be some more planning and thinking through required - of systems and processes, before the need to receive the UBI funding arises.

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how would you link these funds to specific vendors (pharmacies and doctors ) if you give cash to the community and they can spend it however and wherever they want?

That’s a great question, but to be fair, by distributing directly to beneficiaries, we can’t really control how they spend they’re funds. However, a system can be created whereby:

Create a Voucher system that only works at a vendors establishment which can then be exchanged for products at that particular place. Similar to how ReSource works… https://resource.finance/

As beneficiaries claim in a specific Wallet, This can be the same wallet that enables Beneficiaries to purchase vouchers in that wallet. The wallet won’t have a send option only a buy voucher option.

However, it’s a double edged sword as this seems somewhat controlling to some degree. As people have different needs, Some could use it for food, some for medication and others for transport, so these systems would need to be put into place.

But I do genuinely think that if a person didn’t have funds to pay for medication before and UBI helps with that, they’re likely to get the medication as it’s something they need. Hence why I think it’s easier to start with existing communities that focus on specific issues in relation to beneficiaries.

Would the operation of BitFlex be compliant with existing legislations in Zim?

BitFlex is not selling crypto to beneficiaries, we’re utilizing crypto to Support Vulnerable communities as part of our corporate social responsibility.

Legislation is around the buying and selling of Cryptocurrencies,

Grant funds come with an element of control, i.e the flow of funds has to be managed and accounted for. By the way, I grew up in Africa. And I can tell you for a fact that just because someone has a specific need, doesn’t translate into them using funds they receive for those needs.

For example, with homeless individuals, it is strongly advised not to give money. If you want to help them, you buy them food instead of letting them buy that food themselves. Or you ask them questions about their needs and you address those needs directly. I like the voucher idea because the funds you give them can only be used towards those specific basic needs. Or partnering with specific vendors and giving them crypto to use at these vendors (but you mentioned that for tax reasons this cannot be done).

I’ve given homeless people money in the past and then bumped into them later sniffing glue or drinking local illicit brews. This is very common. It’s actually so bad that the approach we took with my fam to help the vulnerable was to just adopt kids from vulnerable communities. I now have several younger siblings from these communities.

Homeless individuals are one example of vulnerable communities but this situation can apply to all others. This is why I advised that a system be put in place that manages the use of those funds. This system would also help you account for the use of these funds to your stakeholders. This system would also ensure that only the appropriate needs are getting met. And lastly, this system ensures that your corporate social responsibility is in fact responsible.

Wishing you all the best :slight_smile:

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Unconditional cash transfer programs are proven to work very well. Do a search on Google Scholar and you will find plenty of rigorous studies. Economists used to think that you needed conditionality to get the benefits of cash transfer programs, but upon further research that seems to not really be the case. Conditionality gets you some limited advantages, but unconditional programs do a pretty good job in achieving their goals.

In other words, laypeople here who are questioning the apparent unconditional nature of this proposal need to do their research on the topic.

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Thank you for your opinion. I’d also like to mention that opinions I have stated in this post are mine.

I followed your instructions, and googled the effectiveness of unconditional cash transfers.

  • Research conducted for Public Services International, a global trade union federation, reviewed for the first time 16 practical projects that have tested different ways of distributing regular cash payments to individuals across a range of poor, middle-income and rich countries, as well as copious literature on the topic. It could find no evidence to suggest that such a scheme could be sustained for all individuals in any country in the short, medium or longer term – or that this approach could achieve lasting improvements in wellbeing or equality.

  • Finland undertook a two-year trial, from January 2017 to December 2018, of modest monthly payments of €560 (ÂŁ477) to 2,000 unemployed people – but the government has refused to fund further expansion.

  • From Kenya and southern India to Alaska and Finland, cash payment schemes have been claimed to show that UBI “works”. In fact, what’s been tested in practice is almost infinitely varied, with cash paid at different levels and intervals

Research confirms the importance of generous, non-stigmatising income support, but everything turns on how much money is paid, under what conditions and with what consequences for the welfare system as a whole.

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I said

None of your links are from Google Scholar or from peer-reviewed academic journals.

My apologies.

Here is one from the University of California, Berkeley. This article was also featured by the National Bureau for Economic Research.

UBIs, on the few occasions when they have been proven to be effective, have actually only been in advanced economies. This “peer-reviewed academic rticle” explains that one of the reasons these systems can work well in advanced economies is due to the existence of well developed safety nests - unlike those in developing economies.

Bear in mind that the jurisdiction in question is Zimbabwe. The social and economic contexts are quite different. I am not against this proposal. I just gave my two cents on ways I felt it could be improved. Improved in the sense that it would make this proposal more appealing to grantors due to a higher level of accountability. At the end of the day, my opinion is simply that, my opinion :slight_smile:

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NBER papers are not yet peer-reviewed. To be fair, I wouldn’t expect you to have known that.

Look at “Unconditional cash transfer programs.” @BitFlexJack 's proposal seems to be more in line with “unconditional cash transfer” concept rather than UBI, since UBI is more associated with a government universally applying a program to all people within its jurisdiction. This proposal seems to be more limited and privately-directed.

EDIT: Here’s the peer-reviewed version of the NBER paper:

I’m pretty sure it’s peer-reviewed at this point. With that being said, your tone in this discussion clearly shows that you are not here to have a respectful discussion. So this will be the last response from me.

His proposal is about unconditional cash transfers yes. I referred to them as UBIs so as not to cause confusion, as this is how he introduced his proposal in the forum. From the examples of UBIs I provided above, it’s evident I’m fully aware that UBIs are government administered, but thank you for pointing that out to me.

The fact that this is “limited, and privately directed”, means there will be a need for the team to be accountable in order for them to attract funds. If there is no system in place that can guarantee to donors and granters that the funds they are providing are actually going to these causes and will be used for the stated causes, then they will have a tough time attracting funds. I actually was interested in this project as I would hope to donate to it if executed in the right way. So the points I was making were from the perspective of a potential donor.

As a potential donor, there is no way I am going to donate funds without knowing that they are being used to improve welfare of the individuals receiving the funds. There is also no way I will donate funds without knowing that the funds are indeed going where BitFlex states that they are. When I look at things from the position of BitFlex, and their goal of CSR, it puts them in a tricky position if the deployment of funds is being used for causes that would render their CSR irresponsible.

This is where I am coming from.

EDIT: The “peer reviewed version” you shared is exactly the same as the copy I shared…

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In my discipline, we don’t mince words. Maybe we go too far though.

This is a better article. In fact, it happens to be in the same issue of the journal where the Hoynes & Rothstein paper appeared:

Unfortunately, it seems to be behind a paywall. Here’s the working paper version of it