South African startup Xoin is hoping to drive bitcoin adoption in South Africa by introducing prepaid vouchers or gift cards allowing people to buy the digital currency with cash.
Once Xoin’s physical vouchers are purchased, customers can then use their smartphones to scan the code and redeem bitcoin using South Africa based BitX’s real-time exchange rate. The service then automatically sets up its digital wallet pre-loaded with the face value of the voucher.
Xoing is not the first South African company to explore the possibilities of bitcoin. Payment gateway PayFast recently introduced bitcoin integration to over 30,000 of its ecommerce clients. But the adoption of bitcoin has been slow in South Africa due to misconceptions about the safety of the crypto-currency and a lack of accessibility.
“The unbanked markets, especially teenagers with mobile phones in Africa, are entirely excluded from ecommerce,” notes Co-Founder of Xoin, Helghardt Avenant. “Bitcoin makes ecommerce more accessible to these markets, especially when it comes to virtual goods.”
After a trial period on local campuses such as Stellenboch University and University Cape Town, the student led startup will be meeting with chain stores to potentially stock bitcoin across the country.
So far Xoin has given away more prepaid bitcoin vouchers than they have actually sold, and will not be charging any fees for their methods of buying bitcoin until there is sufficient interest in their service.
“The purpose is to drive user adoption. In the future we will charge a fixed fee that is capped. This will allow us to drive the fees down,” says Avenant.
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