This is an excerpt and the first in a series of two.. To hear the full interview, click the Soundcloud or Youtube links.
Despite its anarcho-capitalist origins, cryptocurrency is often thought about as an asset for the wealthy or an esoteric tool accessible only to those who are technically proficient enough to use it.
However, there are those who see the role that cryptocurrency could play in the world’s most underbanked regions as a method of storing and sending value.
Recently, Finance Magnates spoke to Richard Ells, founder and Director of Electroneum, about Electroneum’s mobile platform, and its future in the developing world.
What is Electroneum?
Richard explained that as a cryptocurrency, “the whole concept of Electroneum is simplification and ease of access.”
What does that look like on a practical level? “We’ve taken away the long decimal places that [are used in most cryptocurrencies.] We have also made an app that makes it really easy to use as a Cryptocurrency. So, super easy to get involved with the project without having any technical knowledge at all.”
The app is “probably one of the things that’s really critical about Electroneum,” Richard said. “We’re doing something that other people have alluded to, but haven’t really had a plan about how to get there. We’ve not just got a plan, but we’ve actually started on that road.”
Richard said that the mobile app’s ability to mine cryptocurrency is key to the platform because it allows Electroneum to get ENT tokens “directly into the hands of the people, without actually having them get their wallets out and buy it.”
In the Western world, the tokens represent a modest sum–”nobody’s going to go out and retire on the amount that they can mine. But if they’re mining a few dollars, then what you’re doing is exposing new people to a cryptocurrency that have never been exposed to it before… if we can get people to use the cryptocurrency and they have some, then they’re going to look for a use.”
“So if you’re giving free cryptocurrency to 10s of millions of people–100s of millions possibly, we’re dropping this cryptocurrency out to give them a taste of what it’s like to have a really simple digital transfer system,” said Richard.
Registration for the Electroneum Mobile Mining Experience Beta is now open! To be considered for participation please complete the linked registration form. If you are chosen to participate, you will be notified. 🙂https://t.co/L78EWRUtCV
— electroneum (@electroneum) January 3, 2018
Electroneum in the Developing World
Although the cryptocurrency mined with Electroneum is a nominal sum in the Western world, Richard explained that many Electroneum users “don’t have [access to] banking facilities. They’re in the developing world.”
“We’ve got a very large reach into India, Africa, Indonesia, we’ve just developed two new agreements with Latan, so we’ve got a lot of South America as well.”
Of course, “This doesn’t stop people using it in the Western world, we’re happy to have people from all over, and we’re encouraging people to come from everywhere.”
The developing world is where Richard believes that Electroneum really has the potential to become rooted as a key part of the existing way of life. “There are plenty of people, hundreds of millions of people, that earn less than a dollar a day. So the prospect of being able to offset, or possibly even cover the cost of your mobile calls (for instance), would be a huge deal.”
“This is why we’ve targeted the mobile industry,” he said, “so mobile operators have been our preferred route to market. They have been astonishingly receptive to even the concept of giving their users a digital way to pay, because most of their users pay in physical cash.”
“As well as that, we’re also giving their users an amount of money, and of course it’s a mobile operated means to accept ETN as one of the first things they can spend it on, they’re very likely to spend it on their mobile bill,” he explained.
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Richard noted that Electroneum creates incentives on the part of the mobile user and the service provider: “This increases the tenure of the mobile operator…It’s quite difficult for them to get people to stay on board, they jump around from network to network very frequently. There’s nowhere near as much brand loyalty as there is in the west. These developing nations, anything that the operators can find that keeps people on their brand, which is tenure in the mobile world, that excites them a great deal.”
According to Richard, Electroneum has already made major progress in the developing world: “we’ve signed up all sorts of mobile operators–we’ve just signed up another one today and it’s taken our reach to 130 million users.”
— electroneum (@electroneum) January 5, 2018
Electroneum Addresses a Lack of Digital Payment Options in Developing Countries
“There is no shortage in the West of ways to pay digitally. But in the developing nations, there is a huge shortage,” said Richard.
He explained that people in some rural areas of the developing world must go to “extraordinary lengths” to top off their mobile SIM cards: “A trek of 3-5 miles was absolutely normal… and it may well be considerably further than that. It’s very often on foot, or on a bicycle.”
If Electroneum can be used to digitally top off a SIM card, it’s not only a question of convenience; it’s also about quality of life: “The ability to digitally pay for that from wherever you happen to be is a very attractive thing.”
Richard explained that in these rural areas, entrepreneurs that run mom and pop stands that sell things like fruit and bottles of water “are the people that have been recruited to sell mobile phone minutes.”
“Basically,” he said, “they buy bulk minutes and bulk data and they get a ten percent discount for buying in bulk, and they can resell it to people who come along to top their phone off and make ten percent margins. Those people are naturally entrepreneurial, and we’ve got about 1.5 million of those ready to go once we’re ready to go.”
The key is persuading these entrepreneurs to start dealing in ETN: “Instantly, if we can convince those people through marketing and literature that it would be a darn good idea if they could start accepting ETN for physical goods. So if they know that the customer has some ETN but doesn’t have that much cash, why not sell them a bottle of water for some ETN?”
“Then suddenly we start getting into this world where we’re actually making cryptocurrency payments not for fiat things, which is how everybody still sees the world; as Bitcoin into dollars, or dollars into Bitcoin, whereas if there’s a bottle of water for a fixed cryptocurrency fee, and someone buys it directly with cryptocurrency that they’ve mined, then we’re starting to get into a really exciting world of alternate currencies that’s never really happened before.”
How will these entrepreneurs be able to exchange their ETN for cash? “We can get those guys to buy their bulk airtime that they’re selling anyway with ETN, because we know that the mobile operators are keen to accept the ETN.”
“We’re confident of the end users wanting to spend it and being able to spend it, and indeed the little entrepreneurial shop owners hopefully wanting to accept it, and being able to accept it, and have an outlet for it in terms of something to give them a commoditized value.”
The Future of Electroneum
“What’s been exciting is that the level of interest from the mobile operators has been absolutely unbelievably. I’ve been overwhelmed by the positivity from them,” Richard explained.
Therefore, “[Electroneum’s] route to market is really good, and what we want to do is get the mobile miners out there, get users, we’ve got just shy of one million users on the platform at the moment.”
Richard said that although Electroneum’s mobile miner is still in beta, “Once we’ve got people out there mining and earning currency, then we should have quite explosive growth. Once we start getting into the millions of users, it doesn’t take long once people start spending it to be one of the biggest cryptocurrencies in the world by use, just by having a few million people.”
“There are very few cryptocurrencies with millions of users, most of them have got 10,000s or 100,000s.”
Richard said that the price of ETN isn’t the most important thing for him: “Speculation for rich people is not really exciting to me. But if I see 1000s or millions of people, who are everyday people, actually getting some benefit from a Cryptocurrency, that’s what really excites me.”