124. Adventures in Late Stage Fiat: CFA Franc with Fodé Diop
How did the CFA franc come to be the common currency of 14 West and Central African nations? Who controls it and why did it suddenly lose half of its value in 1994? In this episode, we are joined by software engineer and founder of Bitcoin Developers Academy, Fodé Diop, for a discussion on the fascinating monetary history of West Africa. Fodé explains how the CFA franc has allowed France to maintain economic dominance in West Africa, how the 1994 devaluation affected his family, and why he is supporting bitcoin adoption as means of empowering Africans and increasing financial inclusion. Fodé also explains the work his is doing to support the development of Lightning applications and his plans for the Africa Bitcoin Conference: the first ever bitcoin and Lightning conference in West Africa.
- Fodé on Twitter.
- Bitcoin Developers Academy website.
- The Fodé Diop Radio Show.
- Fighting Monetary Colonialism with Open-Source Code by Alex Gladstein.
- Data on broad money supply growth in Senegal.
- The Mobile Wave by Michael Saylor.
- Open-source Lightning Dev Kit and Bitcoin Dev Kit.
- Africa Bitcoin Conference website (Accra, Dec 7-9).
- Shortbits blog
- Ben Arc Lightning point of sale page on Github.
- Saifedean’s first book, The Bitcoin Standard.
- Saifedean’s second book, The Fiat Standard.
Enjoyed this episode? You can take part in podcast seminars, access Saifedean’s courses – including his ongoing course ECO22: The Fiat Standard – and read chapters of his forthcoming books by becoming a Saifedean.com member. Find out more here.
Saifedean Ammous: [00:02:51] Hello and welcome to another episode of The Bitcoin Standard Podcast seminar! In today’s seminar our guest is Fodé Diop, who is a software engineer and the founder of Bitcoin Developers Academy. He is the co-organizer of the Africa Bitcoin Conference, the first ever Bitcoin and Lightning Conference in West Africa, which is going to be held in December in Accra in Ghana.
Fodé is passionate about financial inclusion, as well as finding solutions to the currency problems in Francophone Africa, and Francophone Africa has a pretty astonishing and very interesting set of currency problems that are quite unique worldwide. Everybody in the world has their money problems and everybody has their central banking problems.
But I think West Africa’s currency, which is the CFA is quite fascinating, and I heard Fodé speak about it at a [00:03:51] conference in Wharton School a few months ago, and I thought – I need to talk to him in depth about this, and to get to know more about it. Also more importantly perhaps, to get to know more about what he is doing about it.
This is Bitcoin, we’re not just here to moan and complain. We take action. And Fodé is doing things with Bitcoin and Lightning that I think are very fascinating and interesting to learn about, as well as of course the recent news about the Central African Republic wanting to adopt Bitcoin as official currency.
Fodé, thank you very much for joining us.
Fodé Diop: Thank you for having me Saifedean! I really appreciate it. I really admire you so much. Just even being here, like it’s just really an honor to be here, man. The Bitcoin Standard is like one of my, like Bibles that I keep.
Actually in Senegal, it’s funny enough actually I have good books in Senegal. I have The Bitcoin Standard and I also have The Sovereign Individual, and my mom keeps them for me in Senegal. So when I [00:04:51] go home, I can just take him and go to the beach and read him again and like really get reacquainted with information. So thank you for having me, it’s really honor and a pleasure to be here!
Saifedean Ammous: Thank you, sir. That’s very kind of you. Thank you. Tell us, first of all, a little bit more about you personally. What brought you to Bitcoin and what interests you in it? Where did you come from, what was your background that drew you into Bitcoin?
Fodé Diop: Sure. So to make a long story short, I was born and raised in Senegal in West Africa.
And I was, I grew up there until after high school, when I was 18 years old. And I had a chance to go to the U.S. to study computer science and to play basketball. And then ultimately I worked as a network engineer in the Midwest in the U.S. for a while. Then I ended up going to going to California to work in Hollywood for about a decade or so.
But when the iPhone came out, I felt like the world [00:05:51] was about to change, because I was always a technologist. I was a computer science major already, and I think I had a really, insight on like technology and information technology and so forth. So at the time, whenever I used to go home, I used to basically give my family phones, like smartphones. And for the history of smartphones, for the longest time, no one was able to browse the internet like they were able to do so on their computer. So when the iPhone came out and then Steve jobs basically demoed the iPhone and said that the safari browser that’s in the phone is the same as the one in your computer. I knew the world was about to change.
Because what I realized was that for the first time, actually anybody in the world had the same chance of accessing information on the internet and with the same tools, which actually means actually the browser and so forth. So at that time I left Hollywood and I’m like – man, I think it is actually a technology that’s gonna be really amazing.
So what I did was I had a small idea to create like a event discovery application on the iPhone. So really the first time when the iPhones app store [00:06:51] came out in 08, so I took all the courage that I had, I left Hollywood, I moved to Las Vegas and I said, okay, I’m gonna basically build this app to people, help people find events, parties, and so forth. Me and my friend, actually from California.
Funny enough, I moved to Las Vegas in January 3rd, 2011, and the building that I moved in there was a Bitcoin and Linux meet up on the first floor of that building. And mind you actually, this is like 2011, and mind you, we already went through the whole financial debacle between 2008 and 2011.
I’ve actually almost lost my house in California. It’s a long story where we can like talk, actually talk about it if necessary. So I was already thinking about, like the economy was so bad at that time between 2008-2011, right? The whole debacle with the whole Lehman brothers things happening at that time.
So I started thinking about money and all these things and starting watching CNBC for the first time in my life. I have never even watched CNBC. So I started thinking about asking myself all these questions about money and so forth. And I think at some point I either discovered Bitcoin either through Reddit or maybe like through hacker news. I was reading [00:07:51] somewhere, but it didn’t quite actually register.
So fast forward couple years later, I moved to Las Vegas, like January 3rd, I go in there and there’s a meetup happening in my building on the first floor. So I go in there and this guy is very intense, like really passionate about Bitcoin. And I’m sitting there thinking about, I said, okay why is this guy so intense?
Like, why is he, so gungho about Bitcoin, right? There’s something, there’s gotta be something there. So finally I say, let me actually read the white paper. And that’s what everything changed for me. The minute I read the white paper, I wasn’t even thinking about America. What I was thinking about, I said, okay, we get the two tools now, we have a mobile device which is pretty much becoming a small computer in your pocket, and we have this like global unstoppable non-governmental money, like really showing up in the space. And there was a finally a way for basically Africans to participate in the global financial system.
And that’s really actually how I discovered Bitcoin.
Saifedean Ammous: Wow. Yeah. Michael Saylor speaks about this way of thinking of [00:08:51] Bitcoin as just being the continuation of the smartphone, the dematerialization of physical infrastructure. Amazon did it for shopping, Apple’s iPhone did it for pretty much most things that we use.
You book the cab now through the phone. Your phone and your computer and all kinds of things, and all kinds of economic process are just being added onto your phone. And as I think you say, and as a Michael Sayer says, what Bitcoin does is that it does the same thing, but for money, exactly the back end, which is just an incredibly powerful idea.
Fodé Diop: Incredibly powerful and actually and also a lot of people at the time realize that people don’t really go to Africa, cause, I don’t really know, most people are not, maybe they have traveled there once and know, but for me coming from there, I feel like I had a unique perspective because I grew up in Africa, but also I became a man in America. So I have these two versions of the world in my head where I knew actually where things kind of connect and actually like where basically [00:09:51] Bitcoin fits in that whole equation, because most people actually say that Africa is mobile first. Actually it’s the other way, Africa actually is mobile only.
The majority of the people there will only basically interact with the internet through a mobile device. Through actually a phone itself. They have never touched a computer. They don’t know how it operates. It’s mostly really mobile only as a matter of fact.
So actually solutions we need there, like having mobile only kind of a society and having this mobile kind of a money, actually now, to me was a game changer. And that’s how I actually see like the materialization of mobile, of communication and also of money.
Saifedean Ammous: Yeah. Fast forward, 10 years later, 11 years later, what are you doing about it? Before we get into what are we doing about it, tell us about the problems of West Africa. That’s the most interesting, probably the most interesting monetary experiment anywhere in the world. We use the word shitcoin to describe all [00:10:51] kinds of different things.
But if you want any shitcoin to look good, compare it with the CFA. So what was it like growing under the CFA and tell us a little bit more about the CFA.
Fodé Diop: Actually, so the CFA is basically this currency, this colonial currency which was a pact between France and the ex colonies.
So Senegal actually, we received our independence, so called independence in 1960, not even long ago. And actually most African countries in West Africa have received their independence around that time. So there are about 14 African countries which actually are ex French colonies.
They all speak French, and they also all share the same currency, which is the CFA. They call it the CFA or the frank CFA. And what it was is that when basically, so French left in the sixties and they really left two things behind in west Africa, they left the language, the French language, and they also left this currency.
And this currency was a way for them to control their ex colonies. So give them like a [00:11:51] seemingly independent kind of a thing, and then, but they left the currency behind, so they wanted to be able to control the colonies while they were gone. And actually really the way actually this thing happened was actually was really, it’s an extension of like fascism. That’s really what it is.
Because ultimately when France was under occupancy by the Germans during the second world war, when Germany came, they took away the French franc from France, when France was under occupation, and they gave them a specially denominated deutsche mark for them to use in France itself.
So they had to like actually transact with this particular currency, they had to pay the taxes with this particular currency. So when the war was over, the French, the financial advisors, basically had the idea that, from what they learned from the French and actually see, they saw how actually effective that was and they said – okay we are gonna do the same thing to these African countries, so basically we can pull out and not necessarily pull out, actually. Because if you control their money, if you control the technological, basically monetary system itself, we can control these [00:12:51] countries, we can have basically reserve deposit in the French treasury itself.
They can pretty much print it. Let’s say like this countries basically sell goods, raw materials in the international market, they sell gold, oil or like the precious metals or whatever, they get paid in US dollars, which is this foreign currency, but they cannot use this currency to pay the people.
So they have to take this money, send it to France and France in turn makes this IOU in this basically ledger and in turn prints this paper physical money that they basically ship to these African countries, because the money for this 14 countries, actually 15 technically, but for these 14 countries is printed in the south of France.
And it’s a great, actually it’s a big industry for for France itself. So that said, so now they take the US dollars, the foreign currency, they basically give them this colonial kind of money, and these countries actually cannot even actually buy stuff in an international market with this particular currency. Which is actually not even useful. And France also in [00:13:51] turn gets preferable pricing for the raw materials.
So these countries, when they have let’s say, actually one of the prime example is uranium because it’s actually used in nuclear plants and nuclear bombs and nuclear whatever. Niger is the number one producer in the world of like uranium. Before Niger can basically take the uranium and sell it in international market, they have to offer it to France first. And France can buy it at a preferable price. And then if France doesn’t want it, then they can go ahead and sell it in the international market. And then the European Union doesn’t say anything either, because they actually turned the other way as well, because themselves, Europe in general gets like preferable pricing for raw materials coming from Africa.
So to them, the relationship between French and the ex colonies is perfect for them, because Europe, as we know, doesn’t produce anything. We actually found that recently, through this war with Ukraine, they don’t have any gas, they don’t have any energy, they don’t have any raw materials as well.
So this is actually really at [00:14:51] the core what’s happening, exploitation of these African countries and especially from the perspective of resources coming from these places and they get it at a preferential price.
Saifedean Ammous: Yeah, the story about what the Nazis did, this was what they did in all the countries that they occupied. They would take over the central bank, take the gold in the central bank, and then tell the people that your local money’s broken, doesn’t work anymore, you have to use our money, which is much better. And they would give them their local, the Czechoslovakia’s Deutsche Mark and the French Deutsche Mark, and they take the gold and then they just keep printing more and more of this. And the people in all those countries just witness the value of their money decline, which initially it was not the case for the German mark, but of course it did catch up because ultimately the Nazis were economic central planners.
They were socialist central planners who [00:15:51] controlled economic production, and that had to be financed by destroying the currency. So for a while they could sustain their central planning by essentially being vampiric on other economies. Basically pillaging the other economies that they had occupied and financing their war effort and their economic central planning with that.
But of course, eventually that stuff is unsustainable and Mises had said the same thing about the Nazis, and he said the same thing about the Soviets, and he was vindicated. The Soviets took longer to arrive at that point because the Soviets were effectively more market oriented in their dealings with the rest of the world perhaps, and they were less aggressive military towards the west.
But eventually the central planning failed. But yeah, it’s the same dynamic where you subsidize your government spending by giving foreigners a cheap form of money. And that’s what the French have done. When we look at [00:16:51] the CFA, do we have reliable statistics on what has happened with the supply of it and who controls the supply?
Fodé Diop: That is actually one of the key questions that nobody can answer. Because we have this foreign entity that’s in charge of printing the money for other sovereign countries, somewhere else in the world. And not actually on the supply itself, also like on devaluating the money.
So we don’t even have a choice. We can’t even vote. It’s not like when France were supposed to join the Eurozone, right? They had citizens basically vote whether or not they wanted to be a part of the Eurozone. Recently I went to Oslo for the Oslo Freedom Fest, I was in Norway, I was actually surprised to find out that Norway actually had their own currency. They are in the Eurozone. They actually kept it in Norwegian Crown itself, but Africans never had a choice of actually whether or not they wanna use this money. And then two in 94, the worst thing for me, actually, funny enough in 94, the year I was going to America to actually go to college, our money basically got devaluated by 50%. Of all the years [00:17:51] out there.
So all the money that my dad saved for me to go to college, all of a sudden is worth 50% less than it was a year before. And it’s actually, this happened in 1994. And it’s actually like really well documented, you can find out about it and you can read about it, especially from actually the writings from Alex Gladstein.
And the reason why from the French, it was gonna like basically make exports much cheaper, like for this country. So people can like buy, these poor African countries can sell more on the international market, but in the end, who did they really benefit?
Actually it really benefited France again, and Europe. Because they also, again they get the raw materials at pretty much like half the price. And then, so the money gets evaluated. I get to America, and ultimately that really actually contributed to me dropping out of college, because I didn’t have any money. I just didn’t have enough money to basically finish what I was supposed to do.
To answer your question again, you look at basically this money is printed in the south of France for these countries. [00:18:51] Who has basically knowledge of like really how much of it is being printed? Like how much actually, what is inflation rate? Like really where actually, do we actually have some kind of blockchain system that will help us basically see exactly what the issuance of this one particular money is? Nobody.
Saifedean Ammous: Let me guess, I’m gonna take a guess from my experience with other similar kind of monetary systems in places like the US, they’re gonna tell you that the inflation rate is not about increase in the supply of the CFAs, it doesn’t matter, don’t look at the printers, let the French printers do what the French printers do. That’s none of your business. What creates inflation is the CPI measure. And the CPI is collected by government statistics, and it’s not that bad if you look at it and maybe it’s because of corruption or because of the local government, but anyway, don’t pay attention to the money supply.
Does that sound like a convincing argument?
Fodé Diop: Yep. Yep, exactly. And they know because they print this money. At the end of the day, money is just technology, right? When [00:19:51] you have a dollar bill and the dollar bill is pretty much like burnt halfway through, if the dollar bill still has the serial number, you can technically still go to some kind of central bank and redeem basically the money or get the new bill to replace the burnt out bill, right?
Now, when money is data, you realize that actually France itself has a lot of insights into like how this country spends their money. Where is the money going? Who’s stealing what basically, right? Whose families are corrupt? Who’s hiding money where? Who’s spending money where? Who’s buying mansions and like castles somewhere in Europe to hide their money?
All these president like African presidents, their families, and their cronies, everybody’s basically hiding money anywhere in the world. So that’s really what it is because you have insights into this technology and you have control over this technology because you know how to blackmail people, you know how to like really threaten people with this monetary tool.
And I think actually that’s what happened in Central African Republic, and that’s why they chose to have Bitcoin as legal tender as a matter of fact. [00:20:51]
Saifedean Ammous: I see, yeah. The political element here is that ultimately all these countries, if you’re a leader in that country, if you want to have a monetary system, your only option is to go along with that kind of option. You had to go with that printer in the south of France that you can’t control. That’s the only way that you can access the international banking system, it’s the only way that you can send money to your kids in the US, or have your kids in the US send money back to you.
If you want to join the 19th century of technology, of money and banking, you have to go through this monopoly. The parallels are amazing. I invite listeners to re-listen to this episode and just replace the words “printer in the south of France” with “federal reserve”, and “West Africa” with “the world” and not much changes really. I think it’s just the faster supply growth rate that they do in the south of France than they do in New York at this point. But [00:21:51] eventually all inflation is hyperinflation on a long enough timeline.
Any inflation rate is hyperinflation. How long has this been going on and what other alternatives have there been available? So if you were in one of these countries, and you thought this is not working, could you have switched to the US dollar? How easy would that have been, to just go directly deal with the US dollar and have US dollar reserves get your reserves out of the CFA, get into the dollar or the British pound or maybe some regional African countries central bank reserves.
Has this been a possibility and what has happened to central banks that have tried to do this or governments that have tried to do this?
Fodé Diop: I am so glad you asked. I’m so glad you asked. So what it is is that, so it’s been going on since the sixties, [00:22:51] just like I said again, Senegal had its independence in April 4th, 1960.
So not even that long ago. So it is been going on like ever since second, like shortly after second world war, when they decided to give these countries the colonies. Because they realized that it was gonna be a very expensive endeavor to try to control all these countries as a matter of fact.
They would have like military bases in every single country, trying to control them and stuff. So they realized that they had to basically pull back because also like the mentality was switching as well, Africans realized that they really needed to free themselves from these occupiers.
So they pushed basically for this independence, but it was only independence on paper. Because again, the control has been there like forever. Now the central banks, there are two of them basically because the Frank CFA has two zones. One has seven countries, The Central African Central Bank and The West African Central Bank. The headquarters actually for the west African one is in Senegal itself.
So these central banks are not even actually central banks. What they are is like pretty much bank branches for the central bank [00:23:51] in France. That’s really what it is. Because to me, central banks basically have, they have these two functions for something to be called a central bank.
The issuance of money, meaning like actually you control the printing and making the money, which doesn’t happen, it’s made in the south of France. It’s not made in Africa. So this is not a central bank. Two, inflation. How do you decide the rates of inflation?
Interest rates, like central banks do in America, they don’t have the power itself. So these central banks are pretty much puppets. And they also have French executives who sit on these boards of the central banks and they can veto any decision that can possibly happen.
And there’s always two of them that sit there. And we don’t really know. So are they really central banks? Not really. Now again, once we basically sell raw materials in international market, we can even receive that money. Like recently it happened, I believe actually [00:24:51] with Central African Republic because they sold a lot of gold in international market, and that money gets sent to France.
And France decides to again, to write this little entry in this book itself and give you 50% back of that money that you just saw. Before, actually it used to be a hundred percent. What happened before, it was like, if you sell raw material in international market, 100% of that amount need to be basically held in the French treasuries.
Then they fought for it. Then they said, okay now it’s 65%. Then they fought for more, and now we’re gonna only keep 50%, but is it really 50%? I believe actually the nominal value today is way more than 50% itself. So you basically selling good, you’re basically working really hard, it’s almost like you’re working really hard and someone else basically gets to benefit from basically the labor, the fruits of your labor, right? So even if you sell all this stuff, basically again, it doesn’t really come to you, it goes somebody else. So for yourself, you cannot basically keep dollars actually.
You don’t have foreign exchange reserves [00:25:51] in your own central banks because you don’t have the right to, because actually it’s a contract that basically is signed with this ex colonizer. So now anything you basically sell again, doesn’t come to you directly.
It has to go through this third party. So we don’t even have a choice.
Saifedean Ammous: Yeah. When you describe it like this, it looks like somebody came and took a look at 1900 French colonialism in west Africa, and had a kind of, somebody who like read the Steve Jobs biography and studied an MBA and worked at McKinsey for a few years, and had great ideas about how to make things more efficient to do a 10x gain in productivity with a 10x reduction in cost, and this is what they came up with. Like we were having to send French soldiers to go out there and do so much stuff, and now what we need to do is just control this one little bottleneck, which is the money, which is the blood life of the entire operation.[00:26:51]
As long as we run everything through this little organization, then we don’t need to send anybody out there. We just have all the money come in and we give them whatever we want, and we take whatever we want. It’s so much more efficient as a way of operating the standard colonial model, which is just people are just there are working and you give them as much as you want from their work.
And they have no other option. This is the thing, this is the key point. Ultimately, it’s just how can you escape this? And this is where earth Bitcoin basically becomes the only option.
Fodé Diop: Exactly. Yes. That’s really what I saw it actually again, when I read the white paper, I thought about Africa for the first time.
It’s like this global non-governmental. That’s really what it was, because again, because we actually have issues also because it’s not really cut and dry, it’s not like really black and white, whatever. Because we understand there’s corruption in everywhere in the world, but there’s corruption most importantly in Africa itself.
So if we say, okay we don’t want this colonial money anymore and such, [00:27:51] so who’s gonna be in charge of printing this money? Is it gonna be our governments? Can we actually trust our governments not to inflate this money printing thing again? And actually print all the money for the cronies and everything else.
But we also know that in the future money will be for sure digital. Who’s gonna be in charge of basically making this digital money. We don’t want to use some kind of a Euro CBDC in Africa. It doesn’t make any sense. But it’s okay, our government’s gonna be actually minting this digital currency or basically whatever else it is. I don’t think so.
So to me it needed to be some money that was actually non-government money. That’s actually operating in the free market itself. And then governments can figure out, I’m not saying like actually the disappearance of like fiat money because maybe it’s not really feasible in the short term, but we need basically some kind of tool that is actually not governmental.
It’s also a hard money, which means that the supply cannot really actually like increase overnight while nobody’s looking. Luckily we have this actually global distributed, transparent ledger. We can actually control, like really verify this thing. [00:28:51] I said, okay, we gotta basically look at it, look into this thing actually, and see how we can possibly help us because we are dying.
These countries in west Africa cannot develop. Cannot develop for sure while using this, basically really oppressive currency, it’s impossible for us to do so. We have a youth, you look at basically 14 countries of west Africa, we have over 180 million people, the youngest population in the world. By 2050, the average age in Africa is gonna be about 14 years old.
So basically these people are literally robbing the future from these kids. You know what I mean? So for me looking into it, man, it hurts me man. It hurts me every day. It’s almost like we suffered from colonialism, we suffered from like racism and now we’re suffering basically how our futures being robbed from us, like right in front of us.
But technology is changing man. It’s changing. So for me looking at this technology, I said okay, we finally have a way to fight back. Even I understand that like Bitcoin is like really, it’s a peaceful transition. It should be like a peaceful transition. But these people are like really robbing us blind.
And nobody’s saying anything. The EU is not saying [00:29:51] anything because again, they’re getting resources from Africa for cheap. Look at France, man. They don’t have not a single gold mine. Yet they have the largest stock of gold in the world, in the central banks. Where do they get it from?
From Africa, man. You know what I’m saying? So all of our resources are ending up in Europe. This needs to stop. And for me when I saw that technology I said, okay, we have this money that actually is written with open source code, anybody can go and actually audit this code and see exactly what it does.
The limited emission of money, like how the money is basically put into system itself. Transport addresses, of course it has it’s like drawbacks because of privacy and so forth, whatever. But this is the best we have right now. And we have to use it to figure out a way to get around from these people.
And I think for me, that’s why I was so happy when I saw actually like actually Central African Republic declared this big content law. I never thought I would see it in my lifetime. It’s almost like the people who basically designed the pyramids and they knew they were not gonna see the end of it.
They were not [00:30:51] gonna see the final pyramids, but they designed this thing that ultimately became like one the seven wonders of the world. So for me, it’s very important that we say, okay, we are gonna basically start today, teach people, let em know about this technology.
Let ’em know about this currency itself. And how do we get around this stigma? Because people disrespect Africans and actually that needs to stop. And I’m sorry for being so, but it needs to stop.
Saifedean Ammous: No, you have nothing to be sorry about, I think it’s perfectly irrational.
The people who get upset about people who get upset. Yes. It’s insane. I think there’s a far bigger travesty going on worth getting upset about rather than policing people’s stone. So I agree with you, obviously this it’s a complete travesty and it’s just I think this was maybe one of the ideas that many people told me was like the most powerful for them reading The Bitcoin Standard, is that most people don’t understand how this works, but really that’s what it comes down [00:31:51] to.
If anybody has the ability to make more of the thing that you use as money, you are effectively their slave. You work for them. It doesn’t matter how hard you work. It doesn’t matter how hard you save. You are like a rat on a treadmill, and the harder you run, the more you make electricity for him, for his toys. It’s like you have these rats generating electricity to run machines for you, and that’s essentially what happens when you’re using somebody else’s money. That’s it.
If they have the ability to make more of it, they’re gonna continue to use something else as their store of value. And they’re gonna keep printing your store of value. This is the oldest scam in history. Of course they don’t teach you that scam in schools because your school is almost always financed by that scam.
Your school is an essential part of making that scam work. The way that the scam works is that they teach you that you need to [00:32:51] use this money, you need to have this particular photo of this particular dead person on this money, because you need to have these very good people in charge of holding the money because otherwise, you wouldn’t have money.
Fodé Diop: Yes. It’s a travesty man because the money actually is a trick as well because they printed this number on this bill, that says $20 or $10. You’re thinking that the money actually, that number is actually constant, but you don’t realize that it’s basically the money is being inflated and the money is worth like less and less every day, that $20 actually on a bill is worth less than $10.
Maybe it’s worth 18 point some dollars, but you don’t see that because psychologically they basically actually fool you into thinking that the money, the value of the money is actually fixed. I don’t want it to make it too political, but the idea is that when I saw the Central African Republic, and they decided to basically use this money, I said, okay, this is the first time it’s already starting.
The demise of the [00:33:51] CFA is already starting. Look at those 14 countries today. Let’s look at what’s happening. We have Burkina Faso, Mali, Central African Republic and Guinea, 4 of the 14 countries that basically have kicked out the French army out of their countries, if you think about it. So Central African Republic came and said, actually Bitcoin is legal tender now.
Think about actually, if those four countries decide to basically have Bitcoin as legal tender again, then they can do basically global trade between them. And not necessarily have to actually settle in foreign reserves or if they can basically settle in basically BTC, they can do commerce between each other.
Because what happens is if you sell goods in a global market and you get paid in BTC that money actually doesn’t have to go to the French treasury because they don’t know what to do with the BTC. So the money actually can go directly to those basically particular countries in their own treasuries, in their own public treasuries.
And then if they want to basically buy stuff in the global market, let’s say like Central Africa Republic, they want to buy like agricultural stuff because Africa like really lives on agriculture, [00:34:51] you wanna be able to buy combined harvesters, these big machines that you wanna export out in the world, but you don’t even have foreign reserves to be able to basically buy this stuff.
You gotta go beg France to give you foreign reserves for you to go actually buy stuff in international market. But when you have BTC in your public treasury, you can do whatever that you want. Basically the money doesn’t have to go to France to a third party, it can come directed to you.
And that’s what actually is happening right now. So people are waking up again. There are four countries, it just like more than half need to happen. And then I promise you, the balance basically will be like switch, ultimately. But it’s slowly happening because the youth knows that they don’t want to be enslaved by this money.
And it’s like slowly happening now, but it is happening.
Saifedean Ammous: Okay. So now thinking a little bit more practically in terms of when you think that Bitcoin is a solution, we can see this happening on several levels. So on the one hand, it’s a solution for governments to start using as a way to accept international payments outside of the CFA system.
So yes, the Central [00:35:51] African Republic can start. I mean they could get an account, they could get a Bitcoin account even if they do it with some kind of custodial service in a Western country. I think for all of the drawbacks of that it would be an enormous improvement, likely, over using the CFA.
Instead of using a printer in France that you don’t control, if you have a choice between Bitcoin custodians to process your payments for you, then that would clearly be a preferable situation. That’s one way of thinking of it. But you also have ideas about it being more of a grassroots solution.
Because of individuals using it using Lightning and so on. So tell us how do you see this being the case?
Fodé Diop: Yes, sure. So for me again, I [00:36:51] used to go back home every year Senegal, I spend more time with my mom, my family’s still out there.
My mom, my brother is actually, they’re still out there whenever I go home. Like I used to go to the villages because my grandma’s from like a really deep village, deep inside Senegal. But I just observe, like what’s on the ground. And I said, okay, when I go to like downtown, there are like a hundred thousand banks, Bank of Africa, bank of whatever, west Africa, bank of national something, right?
These banks littered all over downtown, but yet we have the lowest rate of bank capitalization in the world, actually in Africa, right? I believe that actually more than 76% of the adult population in Senegal has never stepped foot in a bank.
So nobody basically has a bank account. So I’m like how is this gonna work? Because banks are pretty much like luxury brands. There’s no difference between a bank and Louis Vuitton and Gucci and all those things. It’s the same thing. When you walk inside a bank, what do you see, man, [00:37:51] again, wood, leather, somebody in a suit, like really it looks like a luxury place.
So those people don’t have actually a real interest and going up and opening up a bank branch in a village. Doesn’t actually make sense. So for you in a village, for you to be banked, you have to basically travel four hours in the city to be able to basically use a bank account. And most likely you are not very educated.
So actually is a bank really gonna help you? So most people in the villages, what they do, they basically keep the money in basically their mattresses. That’s how they do it. And now what is the easiest way to basically send money in Africa right now? It’s basically mobile money.
And mobile money I know doesn’t exist in the US or in the west. And essentially what actually mobile money is, is a way for you to basically go to a kiosk around the corner from your house. You basically give them fiat money, they give you this credit on your phone, and now you have actually mobile money on your phone.
This kind of a fiat kind of credit on your phone, then you can basically send it to the village and whatnot. But guess who controls the mobile money in west Africa? [00:38:51] Orange. The network from France. So France basically even controls the mobile money locally.
And everybody knows the mobile money is like a trillion dollar industry in basically Africa itself.
Saifedean Ammous: And of course the mobile money is denominated in the CFA, right?
Fodé Diop: In CFA, exactly. So me saying that, I said, okay, I’m like, it’s a problem that repeats again, the mobile money is getting popular, but we are using the CFA that we’re basically trying to lget away from.
So when Lightning came in 2019, I was like, oh my God, this is it actually. So all of a sudden, all the problems about the 10 minute confirmation times, all these things basically have pretty much gone away. So now all of a sudden we can basically transact in like smaller amounts.
It’s basically almost instant and almost free. So like a small transaction fee and I can send money to anybody anywhere really through an invoice and such. So as I’m looking around, I say, okay how could this economy basically be bootstrapped right, locally? Because we don’t know how actually people are gonna use this thing.
Is it really money? Is it a commodity? Nobody really knows. But at the end of the day, it’s still a medium of exchange. So the way that I saw it was like, okay, I said, Africa actually [00:39:51] is mostly a agrarian society, most people leave of the land, most people basically are farmers and they leave of basically some kind activity around basically farming.
So what I saw was a way to basically integrate lightning payments or bit of payment in this basically part actually a particular ecosystem itself. Which means that you have this money, it is not controlled by anybody. Again, it’s like really you can pay anybody. You can actually do cross border payments, which means that somebody from Senegal can pay someone from ivory coast, someone from brick house or the neighboring countries, or the country even north of us is Kenya, where they don’t even have the same money. So how do you basically interact with between people who wanna do basically commerce for cattles, for corn, for peanut, Senegal is a big producer of peanut of maybe cashews and all these things.
But how can we basically do this exchange outside of this money? That’s controlled by someone else. And basically that’s how I saw it. And that’s how I started basically looking into like global trade for agriculture. Local trade for agriculture itself and how to basically bootstrap a local [00:40:51] ecosystem that’s like self sustainable. Because obviously the person you are paying needs to also go to buy the fertilizers and all these things basically with money. So they have to have some kind of money to do so if, basically we have close loop ecosystem where people are able to accept basically this money as payment and in turn, pay the supplier basically for whatever good that they need for agriculture, I believe we can basically start to have like local economy that’s based on the currency. That’s outside of like the currency control by these colonizers. And that’s how I saw it.
Saifedean Ammous: Yeah. Now I’m curious here obviously, the obvious question is in terms of mobile penetration, how high is mobile penetration in the CFA countries?
It’s not very high at this point, is it?
Fodé Diop: Actually it depends what you mean by actually mobile penetration, because there is a huge, in west Africa, everybody has a phone pretty much nowadays, man. Android phones are becoming like sub $100. There’s a couple,
Saifedean Ammous: But I know in Central African Republic I heard something like 90% of the population [00:41:51] doesn’t have.
Fodé Diop: Yes, actually yes. Ninety percent actually doesn’t have, because it’s a very, it is a very poor like zone for one, and then the penetration actually is not very good, but actually in Africa we have this thing called USSD.
Which is actually different from basically internet communication. So which means that when you have a phone that’s not a smartphone, that’s like another Android, whatever, you have a small blockier phone, you can basically dial, let’s say *123# and another number, and you can basically interact, like actually interactive real time system, where you can basically send money without actually having the internet itself. And there’s a company in South Africa, they just launch a system at, I believe they’re called Chankura, and you can basically transact in Lightning with your basically USSD.
Which means that you can basically actually transact offline. If you look at actually Africa, so you actually you’re absolutely right. The majority of the people in Africa, basically people don’t have internet. Which means that they basically actually transact via USSD itself.
But most of the money [00:42:51] from VCs go to companies, they basically only invest in companies where the applications actually need the internet to be able to work. And nobody’s thinking about the people who are offline again, nobody’s like thinking about them.
Do we have like millions of dollars every day uses companies in African, in Nigeria, they raise $5 million a year, $10 million there, $20 million a day, these VC firms like put all this money being put into Africa, but nobody’s actually investing in actually offline systems, unfortunately. Because maybe they don’t understand actually what USSD means they don’t understand how people basically use money locally itself. And actually the majority of the people in Africa itself do not have access to the internet, unfortunately. And nobody’s really actually talking about that.
So when I saw the company called Chankura and you can do basically Lightning and Bitcoin actually transactions via USSD, I said this is amazing man, because people are finally getting it. And they are thinking about the people who don’t have access to the internet. But they do have a mobile device itself, but mobile device penetration is very high because I believe that there are [00:43:51] more actually mobile phones in Africa right now than people who live on a continent itself.
So penetration is for sure there.
Saifedean Ammous: Okay, so it’s yeah. You don’t need to have internet basically to use Bitcoin and Lightning. That’s extremely powerful. And I think people usually give this example that Africa just never installed, in many places in Africa they never had the landlines and they never will. Because there’s no point now when everybody has mobile. And I think it might be the same for fiat banking. Just think about the many layers of institutions that you would need to build in order to integrate the Central African Republic into the global fiat system.
And get to the point where they have the PayPal and Venmo. Or just go on Lightning.
Fodé Diop: Go on Lightning, exactly! That’s really actually what it is. How do we basically skip all the steps? We skip landlines, we’re gonna actually pretty much skip banks, because [00:44:51] to me, I still believe again, go back to Michael Saylor, the mobile revolution, his first book. That book was amazing because it talks a lot about like really how mobile devices will change the world. And to me, that’s really what it is because nowadays there’s a company called Tecno, actually, you probably never heard of it, it’s a Chinese company.
They sell more phones in Africa than basically outside of Africa itself. They don’t even sell phones in China. It’s Tecno and you can actually buy an amazing Android phone for about actually less than a hundred dollars. Which actually means that in a couple of years, those phones are gonna be even cheaper.
So what actually, what does it really mean? That means that basically the future of banking is the Android device mostly. I’m not talking about like outside of the west and the US, right? The future of banking is an Android device directly connected to the Bitcoin blockchain. That’s really how I see it basically.
Because at the end of the day, it’s just open source. It’s pretty much like a software stack. It’s nothing really fancy about that. The idea is that we have this global distributed system itself computing system itself, which can [00:45:51] actually verifiably prove like a transaction itself.
It’s actually really global and nobody can cheat anybody. It’s a global distributed ledger. Basically every time a transaction is within, in a block, we know that actually it’s confirmed itself. So why not basically have a device that’s actually directly connected to this particular actually comforting paradigm?
And I think actually that’s really where actually the change will come from. It will take a little bit of time, obviously, right? Because again, there’s debates about whether or not what is money, is Bitcoin really money and all those things. But I think we can think about that right now. What we need actually is basically more adoption because actually with more adoption we can basically figure out these little problems and figure out basically these little conundrums actually happening with Bitcoin itself.
Because what we need actually is more adoption and more people basically using this technology. .
Saifedean Ammous: Yes, absolutely. I wanna go back to talking about the CFA for a minute. This is extremely fascinating for me. Now, when you when you said in Senegal, you had hyper [00:46:51] inflation when that happens, it’s not just hyper inflation in Senegal, it’s hyper inflation in all the countries that are having the CFA.
At the same time, right?
And when that happens, what is the official explanation that is given of why hyperinflation happened?
Fodé Diop: That’s actually, that’s a good question because the, I believe the CFA has lost, I think like more than de near 200% of his value since it’s an inception, like back in the, like back in the sixties.
But I don’t think even people understand like inflation, man, they just read, they just think that. Prices are going higher, like to them actually that’s really, I think of what it is like the general public, because maybe they’re not educated about money but no one thinks about money.
And to me, like Bitcoin is actually amazing because Bitcoin, for the first time in my life, I sat down and thought about actually, what is money? That’s really actually what the, for me, what the revolution was, but most people don’t think about it. So all I think about is, okay, like [00:47:51] prices are going higher, everything’s becoming more expensive, but they don’t think that. They don’t think actually the fact that their money is having like less purchasing power itself, because inflation itself.
Because actually the money supply is coming into the market itself because there’s more of it. And actually there’s more basically money chasing the same goods. So goods like becoming more expensive and you’re purchasing power is basically like depreciating over time.
So there has never been an explanation. I don’t think people have ever even, I’ve never seen any public debates about actually that about actually inflation. All I see basically around debates and what they’re about is actually whether or not the frank CFA is basically harming our society. That’s what actually people talk about today.
Saifedean Ammous: Yeah. Once you see this, once you start seeing the monetary underlying dynamic, in my mind, you start thinking that everything else really doesn’t matter. The kind of things that you read about in the newspaper, in the news every day that people get worked up about the constant array of current things that you are told that you [00:48:51] must be outraged or angry or happy about by your local propaganda dealer, is completely inconsequential compared to the fact that the money that you’re using is being printed by somebody.
Fodé Diop: That’s 100%, 100%.
Saifedean Ammous: As long as you are not addressing that problem, I cannot help but think that you are basically deliberately distracting from it, because this is what I would do if I was a beneficial of this kind of system and people start pointing fingers and asking, hang on a second, why do you get to print money while we have to work for the rest of the money? I’d bring up all kinds of other problems for you to worry about. I’d be like, don’t worry about my money printing, focus on looking at the problem with the corrupt local politician that you had that did this or that. And of course, obviously there are corrupt local politicians everywhere, but [00:49:51] that’s completely inconsequential when somebody keeps printing the money.
Fodé Diop: Exactly. And actually guess what? For the first time in Facebook’s history, I think there was a article by the Washington Post a couple years ago in 2020, they basically pointed finger directly as people who are basically spreading fake news on Facebook.
The article is actually out there, you can look it up, it was the French army. The French army is meddling with basically social media, because what they do is pretty much put out basically false information out there all the time, so people are focused on other things and like really meddling with things other than really focusing on the real actually problems. Again, political problems like politicians or whatnot. But I promise you that is about to end. This youth, the new generation, they are tired of this situation. They are very smart. They are more activists coming from every single country in west Africa now. They are on YouTube. We have social media, it’s becoming louder and louder and louder every year. So this thing cannot go on. It’s impossible. And regardless of the fake news, we have people actually who are more conscious about what’s happening right now. Actually more conscious about [00:50:51] actually how our future is being robbed from us right in front of our eyes, because it is money that we’re using.
It’s like useless money. It’s not even useless money, like this money, when I have it in my pocket and you ask anybody, I land in any airport in the world, I go to an exchange forum, nobody wants it. Nobody wants it. So this money is basically money for like second grade citizens.
When I go to France, I cannot use this money. And yet they make it. So what does it really mean? So you are basically making money for like second rate citizens.
Saifedean Ammous: Yeah, it’s absolutely astounding that they tell people to buy a money that they don’t hold. I think this is incidentally the biggest problem with shitcoins. Another problem that I have with shitcoins that most shitcoiners, well maybe not most, but a lot of shitcoiners will tell you that, they promote shitcoins, but they still maintain the majority of their wealth in Bitcoin.
They want other people to get into the shitcoins because yes they want other people to take the risk, but they’re the ones who are promoting the shitcoins because they can print the shitcoins [00:51:51] and they can’t print Bitcoin. So they save their money and the money that they can’t print, but they tell you about the virtues and benefits of the money that they can print. It’s a very common mode of operation for money printers, but another incidentally, when we were talking about the distraction from those things it’s very interesting here, there are a few organizations out there that do have a little bit of resources available to them to, study things like the world bank and the IMF and they happen to have, a lot of PhDs in economics and a lot of experts on Africa and west Africa.
And a lot of ideas for how to improve Africa and west Africa, and somehow all of these ideas always involve more debt and very rarely do you ever hear them saying, Hey, you know what might be a good idea, [00:52:51] perhaps those countries should stop using other people’s money and get their own money that is made by something that other countries can’t print, but also their own politicians can’t print, like maybe gold or Bitcoin. You’d think with all of the concern about Africa, the world bank at the IMF brings up in order to sell their billions of dollars of debt to these governments, you think they might say, Hey, maybe use something that can’t be printed by a bunch of dudes in the south of France on a weekend, have something that’s a little bit harder to store all the wealth of your families and all of your future generations, perhaps pick something that can’t be done, that it’s surprising how many people are so concerned with African issues and yet completely unconcerned with this one little detail, isn’t it?
Fodé Diop: Yes, exactly. So actually look at actually prime example is Central African Republic. [00:53:51] Like how many world organizations are present in that particular country? For the last two decades, 20 plus years they’ve been in this country, they’ve been coup after coup after coup. Every single president that came in power in Central African Republic was pretty much there because of a coup itself.
Because they kicked out the last president or whatnot. And you wonder, you say, okay, how come all these like world organizations are in, so present in Central African Republic and yes, it’s second poorest country in the world. With all the resources in the world, they get the gold, the diamonds, the bauxite, all the basically raw materials that the entire world basically needs.
Yet they live in dire poverty. The IMF has never been able to do anything. They have never been able to solve the problem for these people. So obviously there’s a problem or they are part of the problem itself, right? So like you said again, how do we basically, how can they like really look like, like really look at this happen under their watch, doesn’t actually make any sense.
I’m not like .conspiracy theorists, whatever, but things actually like really like things have never changed when these people basically were in [00:54:51] power. And now what’s happening again? Things are getting more complicated because now the Russians are coming in money.
The Russians are coming to Central African Republic, the French armies are being basically kicked. So what is actually happening, is the situation gonna get better? And basically the Russians that’d be actually surprising because I don’t understand how the world feels about Russia now, right now.
But I feel like it’s like a cold war all over again. Like people saying that basically that Central African Republic chose Bitcoin because of Russia or whatever. Because Russia wants to have access to the resources and blah, blah, blah or whatever. Maybe it’s conspiracy, maybe.
I don’t know. But the reality is that Russia is becoming more and more present in west Africa itself where basically the French left and left a vacuum behind. Basically the Russians are basically filling in the vacuum. So what is gonna happen in these countries again? What is gonna happen?
No one really knows. So again, there’s rumors again. I don’t wanna say this instead, actually. I know for sure there are rumors that the Central African Republic chose Bitcoin. They actually, because in the incident that happened between them, the Russians. So apparently they, what happened [00:55:51] was there was they saw some gold, like somewhere in the global market, they didn’t really get the money that they were supposed to get because they were supposed to buy some weapons to basically help them fight against the rebellion happening in the country.
Because apparently the president felt like he wasn’t really a president because his presidency basically stopped with the surroundings of Bangui, which is the capital of Central African Republic itself. He felt like he didn’t have control over the rest of the country itself. Can you imagine you are like ahead of state for a country, you are basically sitting in Washington, you only have basically control over Washington, but not the rest of the United States. It doesn’t make any sense.
Saifedean Ammous: It’s a good start, ideally you wouldn’t have control over for Washington either, but it’s a good start.
Fodé Diop: No, sure!. But then, yeah but I understand what they were saying, because what happens is for you to basically have control like sovereign control over your territory and monetary control, you need to have basically control over your territory itself. There were rumors that the French were having air strips, lending fields, actually air like air strips, like somewhere in basically middle of Central African Republic, [00:56:51] where they can lend plans and basically take resources. And nobody would know because nobody ventures out there because all the like rebels happening and all these things. So again, rumors are that there was a ship point of weapon that they had that was stuck in Somalia.
And then the president basically accidentally linked up with the Russians. They went out there and they say, Hey we have this basically shipment of weapons that will help us basically defend ourself against these rebels. But it stuck somewhere in Somalia. And apparently because of the world or whatever, they were like go on weapons, and supposedly they were tempted or whatever, right? So they want to see the Russians talk to them because say, Hey we heard that you guys vetoed the this law for us to get our weapons. And the French were like, no, sorry. The Russians were like, we don’t know what you’re talking about.
I guess they wanna talk to top some people, they were like, what? You have some weapons. These weapons actually are like outdated. You can’t even use them to basically defend yourself. Let’s basically help you get some weapons and get whatever else basically. So you can basically be in control of your territory.
So I guess they lined up the French. So the Russians gave some money to the Central African Republic. Obviously [00:57:51] the money cannot go directly to Central African Republic. The money ended up in France, France blocked it, so the people were like really mad and they said, okay we’re gonna figure out a way to basically be more sovereign, have more control over our continent, have more control of our territory, have more control over our money.
We’re gonna call the Russians to help us basically defend against this rebellion. And we’re gonna use basically the Bitcoin to be able to do global trade and basically circumvent all this basically rules by the French. And this is rumors again, but that’s what I’ve been finding out more and more, the more basically that I’m digging.
Saifedean Ammous: Yeah, it’s fascinating. And I think it’s likely that we’re going to be seeing more and more of this. We, yeah, we saw this with El Salvador. Ultimately El Salvador is a country that does not have a central bank, and so it doesn’t stand to lose anything if it’s people move to Bitcoin because they’re not gonna miss out on any seniorage.
In fact it frees them from having to give their seniorage to the U.S. It’s not quite as bad holding the US dollar itself. [00:58:51] Is not as bad as holding the CFA. Would be the equivalent of if the countries or the CFA were using the Euro. If they could just use the Euro, and they couldn’t print a Euro.
I think that would be infinitely better than the current arrangement. It would be similar to what El Salvador has with the US dollar. And some people would say, this is a negative arrangement because it means the El Salvador government doesn’t have the ability to conduct monetary policy.
But for me, this is the best thing about it. You get rid of the Salvadorian government being able to conduct monetary policy, and then that means they can’t mess around with things. But yeah, but I think it’s still better to be on Bitcoin and not have to abide the us monetary policy and just have Satoshi’s monetary policy instead.
Fodé Diop: Exactly. And actually now, it’s funny because we we were all dreaming about basically Bitcoin adoption and again, for me, even to be living [00:59:51] where in a world where Bitcoin is liquor tender somewhere is amazing. And now we have basically two models. We have the El Salvador model.
Then we have the central African public model. The El Salvador model was more like a top-down model. They wanted to basically have they force the Bitcoin on, on the constituents, on the citizens. I don’t think it was a right move per se. Because of course you’re gonna get pushback from people.
Especially people who are poor and really don’t actually understand this technology because Bitcoin is still hard to understand so for someone who’s not very educated. Instead of the public, it was a different model. So for them, it’s more like, how do we basically use it on the government to basically really be able to celebrate resources on on a global market.
So we see how basically is through philosophies an end and which one might be better ultimately, because again, right with Bitcoin, there has to be a lot of education for the local population, because the problem is like the volatility is a issue itself, right? Like when you’re poor, you cannot afford to have your your savings decreased by 20%, 30%, 30% overnight.
It’s too difficult to basically for you to basically [01:00:51] handle and to you actually, it’s not really feasible because you have a family to feed, right? So the money needs to be constant at all. Times, if I have a hundred dollars in my wallet today, it needs to be a hundred dollars tomorrow when I wake up.
It’s very important. So for us, I think like right now, that’s why actually we cannot wait for the road adoption to get here. So the price can like really stabilize for actually people to have more confidence in this, basically in this global money. And I think it’s very important and I think only the future will tell whether or not basically the El Salvador approach or the central African actually approach was the right move basically over time.
But it’s the best, it’s the best experiments we have right now.
Saifedean Ammous: Yeah. And I look forward to us getting many more of these experiments as I think for whatever you may say about what has happened with El Salvador and experiment, whether you think it was good or bad for El Salvador, I think and you can agree or disagree with the president.
I think just the proof of concept, the [01:01:51] illustration of the fact that we’ve done a Bitcoin standard minimum viable product. It’s a country of a few million people and millions of them. Could download the wallet and receive some money and spend it. Whether they cashed out or whether they kept the money is another issue, whether it was whether you think it was a good idea or a bad idea, whether is another issue.
But I think the technical fact that it just allows us to very simply point to people point El Salvador as an example of just how Bitcoin can scale, Bitcoin can work, Bitcoin can be used, and everybody could use it on their phone and all of these issues about, oh Bitcoin can’t scale, or Bitcoin’s too slow or broad confirmations, all of these things we saw just how Lightning gets around them. Even if you know what, whatever you say about the wallet, it managed to get more people onboarded than the El Salvadorian banking system has managed in centuries.
Fodé Diop: Exactly. Actually, people actually people say like [01:02:51] Bitcoin is slow, but I have a kind argument for that.
I said, okay, Bitcoin is really slow, have you ever actually been to a bank? How many people does a teller service per hour? If you think about that and you think about the number of actually transactions that are available per second for the world itself, I think like banks are much, much slower.
I start servicing people actually than actually Bitcoin is like human nature. Actually in the us is all right in the us is okay. But I promise you go to Africa, man, just for a simple deposit or talk to the banker. I would be in line for about an hour.
Like to actually even talk to a teller and then you get to the teller, it’s almost like they are doing you a service. It needs my money, and you’re actually acting like you’re basically doing a service for me to basically interact with your bank. So the level of customer service is very different in Africa than it actually than it is in the west.
Ultimately, so for me, I don’t even wanna deal, actually have to deal with the banks themselves, because they’re slow and antiquated man doesn’t actually work anymore, so we gotta figure out a way to just actually get here and bring more education because as people understand the benefits actually of using the system, then actually adoption will [01:03:51] basically grow organically.
And again, if it’s free market, Bitcoin exploded in the free market. It’s free market money. The market that the market’s actually decided that they wanna use it. And actually that ultimately gave it value itself. So I thinking like what’s gonna happen, actually, it’s the same thing happening with users on the ground itself, actually the market would decide, so the market would decide, but thinking like for that to happen, needs to be like more education.
And actually that’s why for me personally, I focus more actually on the software side of things, because I believe actually we need more builders and people who really can help us basically. And we need an army of builders because nowadays armies, they basically technologists. It’s not, they don’t have guns anymore.
You can basically write code and basically change the outcome of the world. Look at Bitcoin. Somebody dropped it on internet on Halloween of 2008 out nowhere, the white paper. Explaining that actually there is no monetary system, this is a cash to cash peer system itself. Couple months later, the first block was basically mined to January 3rd, 2009.
But it’s open source, free open source software. It’s powerful, man.
Saifedean Ammous: [01:04:51] Absolutely. And this is this, we can talk forever about the injustices of this system and about all kinds of injustices in the world. And a lot of people do and there’s a lot of injustice in the world, a lot of things to get you angry and get your to boil.
But the amazing thing again is instead of letting them get to you is to go out there and do something about them. And this is, I think this is the thing that the nocoiners don’t get about Bitcoiners. That this is why it’s Bitcoin just seems so weird for them because when you get Bitcoin, you get that complaining and moaning and whining gets in the way of action. Bitcoin allows you a way to act. Bitcoin allows a way to make this better. Like you can go to somebody whose life is getting ruined by inflation, you can tell them, here learn the dark orange arts, and you can stop getting robbed by your government.
And [01:05:51] it’s an actual solution. This is why Bitcoin really changes you. And I think a lot of Bitcoiners agree with this. Bitcoin changes you because you go from a person who doesn’t see how their actions can impact the world to a person who can see how their actions impact the world.
And so you go from being basically depressed about the fact that you’re helpless and that there’s nothing you can do to becoming hopeful and optimistic that you can do these things.
Fodé Diop: Yes. That is exactly, you hit it right on the nail. That’s exactly that man, because I remember exactly my life before and after discovering Bitcoin itself, because I felt hopeless.
Look at me, man. The money that my dad saved got devalued by half, like 50%, I’m thinking about devaluation and all these things. But then again, Steve Jobs said the best, he said, only looking back can you connect the dots. And then when I discovered Bitcoin, I started looking back again in my life, the money, the history of the money, self, the history of colonization and thinking about all these things.
And for me, I thought I was crazy. I said, why am I [01:06:51] thinking about these global macro things? Like thinking about like how countries can do business between them and global trade and all these things. I never thought about those before in my life, I was just worried about my job, playing basketball, like really simple things.
Where Bitcoin opens up your mind. And actually for the first time I said, you know what I said, the more I talk to people, the more I said, I know I’m not crazy, you know what I’m saying? The more I share my ideas, the more I get invited to basically share my ideas. I said, okay, I’m not crazy, obviously. So for me, I feel like even as an individual, I have the power to change the world, man. That’s a mind boggling factor, actually, mind boggling thought, it’s almost like a software engineer, right? You have ideas in your head that you can basically go on a computer and basically bring him to life in the world.
People think about who made WhatsApp, people who made software, that the billions of people in is actually in this world to you use it was something in their brain and they basically brought it to life. So I think about the same thing I said, okay you know what? I can’t be like, I’m a nobody, I don’t have a chance to like, change whatever.
But the idea is that I do have the [01:07:51] power. And again, I go back to Steve Jobs because it was my role model man, the people who think that they can change the world at late, they might think they’re crazy, but usually actually that’s the ones who do. Because I have the belief in my heart and the belief happened because I discovered this technology because I know, like you said, it’s not hopeless.
It’s not hopeless, man. We actually have a chance to like really change things it’s actually possible. And for me to look at again, west Africa at the global level, and I see this vampire state of vampire statement, which is France, like sucking all the life in energy outta west Africa today. And nobody’s saying anything.
I said, okay we can’t wait for somebody to come and save us. Nobody’s coming to save us, man. Nobody’s coming to save us. But the idea is that we have a tool, acknowledgeable tool, that’s so powerful, that’s a global tool for us to basically be able to participate, changing this code, put in our own vision and insights, because again, Bitcoin is open protocol.
Anybody in the world can build on top of it. So it’s important also for [01:08:51] us, for Africans, not to let the west try to save us. Because most of the tools come from the west. If you look at WhatsApp, Facebook, Instagram, TikTok, everything that everybody uses today, was made in the west and it was made for Westerners actually.
Nobody has ever thought about the user you user interface or use user experience for this particular part of the population. So I said, okay why do we wait for somebody to come and actually come and save us? We know what our problems. How do we use this open protocol to build the tools, to basically solve our particular problems, like solutions for our particular problems, right?
We have to build them ourselves so we can wait for no one. So now we have a chance it’s not hopeless. We can basically use this tool to make a difference for our future and for our kids and for the future generation of Africans. And I think it’s very important one, I think it’s important.
Saifedean Ammous: Yes, I do, and I agree. So tell us, what is it that you’re doing? Tell us about Bitcoin developers academy and about the conference.
Fodé Diop: Yes. So the Bitcoin Developers Academy is an online school to help basically people [01:09:51] actually build Bitcoin applications because I realized that when I was learning about Bitcoin protocol development, actually, it’s very difficult and it’s not for everyone.
For protocol level development, you need like really advanced knowledge. Of course everybody can learn that stuff, but I think it takes a while. You will need almost like masters or PhD level to be able to like really interact with this particular software, I believe it’s not for everybody, but what we need is basically applications built on top of Bitcoin, like layer two, layer three, like Lightning and more.
And I believe now with the tools that are available, actually, especially the tools that were open sourced by Block, by Jack Dorsey’s company, which is amazing, which is BDK the Bitcoin Developers Kit, and LDK the Lightning Developers Kit. I believe actually it’s becoming easier for people basically to spin up Bitcoin applications on top of the Bitcoin protocol.
So I realize that actually, maybe this is actually much more accessible to people. So if you have experience building mobile applications or building actually web apps, you can easily basically build Bitcoin applications on top of the Bitcoin protocol. So that’s what the Bitcoin developers academy is, and to make it a little bit more [01:10:51] accessible.
So actually also like to do it at scale. So a lot of people can basically learn at the same time online. So it’ll be live, it’s a little bit delayed, but it’ll be live this summer. Hopefully again, it’s a Bitcoin Developers Academy and second of yours we are doing the Africa Bitcoin Conference in Ghana this year December 7th, 8th and 9th in Accra, Ghana.
And I’m inviting you all. Hopefully if you can make it to come out and be a participant in this really first in a lifetime kind of event in the west Africa, I’m putting it together with [?] Out of Togo, she’s like an amazing activist. She lives in Ghana herself, [?] I believe from Congo and Rwanda and there.
And my brother actually is part of the team as well, and [?] here also like one of our actually teammates. And we have a lot of support from Paxful, from the human rights foundation, from B-Trust, from all these people, we have raised quite a bit of money already, and it’s happening December 7th, 8th, 9th in Ghana.
And if you go to afrobitcoin.org, you can [01:11:51] register, put in your email and you’ll be notified when the tickets go on sale. And that’s what I’m really excited about this end at the end of the year, this year.
Saifedean Ammous: Nice, nice. So what is what is the goal of this conference? What are you trying to achieve from it?
Tell us more.
Fodé Diop: Yeah, yeah. So for me what’s important again, is to bring knowledge back to the continent. I grew up in Africa, I was there until I was 18. And then since then I’ve been in the US ..Now so I spent half of my life in Africa, half of my life in the US.
So what I wanted to do basically is be able to like really transfer this knowledge and bring technology back to the continent itself. To me that’s how I felt like I can basically contribute to the continent itself. Bringing people who are knowledgeable, share knowledge, bringing people who know how to do practical things, make hardware, wallets, make open source software, like basically seed signer specter wallet with [?], like all these guys that are making like tremendous, like open source software, Ben from the UK, he makes these little offline point of sale systems like amazing QR code based.
And you can make it with like open source software, opensource hardware. So as I basically traveled the [01:12:51] world and I’ve been to all these conferences in El Salvador, in the US, everywhere, like this year I was a keynote speaker at the Bitcoin Conference. And I met like tremendous people. I met Michael Saylor for the first time like actually in person.
I said, okay, How do I basically bring back all this knowledge to my continent and the best way to do so basically is to do a conference. Invite everybody, come out there, share knowledge. If you know about Austrian economics, if you know about basically Bitcoin protocol, if you know about how to basically build the Bitcoin hardware, Bitcoin software, I want to invite everybody that I’ve met all these years to come to Africa and share this knowledge.
And I’m invited them all this year in in Ghana. So that’s my goal, basically, to transfer knowledge and bring more knowledge on the ground and train more people locally so they can in turn train other people. So it’s just like a gift that keeps on giving. And that’s how I basically figure out a way to bring knowledge to the continent.
Saifedean Ammous: Fantastic stuff. Now tell us how do you find the use of Bitcoin now? Do people use it? How many people use it? Are there exchanges, are there over the counter buyers and sellers? How [01:13:51] does it work?
Fodé Diop: Yes, I think there actually of course, Binance is dominating the exchange world nowadays.
But in Africa we have Binance, we have Paxful, but we also have like local homegrown startups that are like really domain amazing. Actually most of them out of Ghana. I’m sure you’ve know about [?] with Bernard, they’re amazing, they’re building APIs, they’re building lightning and Bitcoin APIs and it is just like amazing.
There are companies. Most of them in Ghana, in the west Africa, in Kenya, in South Africa, actually. So no west Africa in South Africa, unfortunately it’s not growing as fast actually in French speaking Africa actually, unfortunately, exchanges are not really there as a matter of fact.
So the thing is like it’s becoming more and more over the counter. So it’s mostly private groups on WhatsApp or telegram. Usually there’s a guy in there who knows everybody, and he’s a trusted middleman. You send him the money. He sends the BTC to someone else and all those things, but also stablecoins have taken off in Africa.
Nobody’s really talking [01:14:51] about this, but stablecoins are very much so in use. And you’ll be surprised to find, actually find out that the most popular stable coin in African Senegal, especially right now is basically Tether on Tron. On a Tron blockchain itself. Because at the end of the day, people do care about transaction fees.
Because again, if you’re poor transaction fee matter, it cannot be 50 cents, 40 cents and all these things, right? So people want something that’s fast, cheap, and usually people will copycat, they just heard somebody doing it, somebody says, okay, this is the best way to do and right now, if you go on WhatsApp, like Tether on Tron is really the dominating stablecoin.
Actually, unfortunately I would say, unfortunately, because I’m not a big fan of Tron, but Tether on Tron is like really one of the top, really stablecoins in west Africa.
Saifedean Ammous: Yeah, no, I think this, I saw this myself in the middle east as well, they’re highly useful, I think. And when we had an episode with Paolo Arduino, who’s the CTO of Tether, I think that it’s an extremely powerful technology.
And I think that the one problem with it is that it has to be done currently on shitcoins. [01:15:51] And some people will say stablecoins prove that shitcoins are useful, in my mind what they prove was that shitcoins have been a very expensive distraction. Because it’s not possible to scale stablecoins on any of the alt coins because they are all on, what’s gonna happen with all of them is the same thing that happened with Bitcoin. On chain is too expensive. Eventually the transaction fees are going to rise and this is the case, right now, even withdrawn and with all of the other alt coins, when you’re running stable coins, you’re paying something like 50 cents on a transaction fee.
It’s still sometimes higher. It could go up significantly higher depending on the demand . So it’s still not at the point where it’s possible for people to be using it. For small transactions, we’re buying your lunch and for buying your coffee. But, if we weren’t, if we hadn’t spent the last five, six years, so with so many people wasting so much time on [01:16:51] launching their own tokens.
And instead that time and effort and energy had gone to develop the one network that can scale because it’s the one that is built on a neutral platform that nobody controls, which is Bitcoin. If that time and effort in the engineering talent had gone to developing Lightning network and developing stablecoin on Lightning , they would be scaling now in Senegal and in the Middle East and in Latin America and all over the world much faster, because then the transaction fees would be much lower.
And that’s why I think it’s going to be enormously significant when we get Lightning.
Fodé Diop: Yes, absolutely. Absolutely. Lightning based Tether or Taro, the protocol being designed by the Lightning labs, I’m really bullish and really excited about that. I know Lalo is like an amazing engineer and I can just wait to see actually what they come up with, like on a stable side of things on Lightning.
And I think it’s very needed itself. So for me, I actually like really actually cause I push more Lightning because it’s again, it’s almost instant, almost free, and [01:17:51] it’s BTC. It is not really some kind of, layer, like some kind of other like wild token on top of Bitcoin.
And I think also like Lightning is very important on other side also like actually travel quite a bit and lightning actually is even more important for digital. No because you’re constantly traveling from one country to another, and usually you don’t actually have the local currency actually, where you go most of the time.
Or you have some currency that you wanna exchange before you leave that country and so forth because I’ve been seeing actually more than more and more do those kind of problems in the digital of nomad kind of world. And I believe that actually Lightning could be like a really actually great tool, but basically solve the particular problem where the people who can hop from one country to another like on a regular basis.
And for me personally, actually, that’s how I use Lightning to solve my own problems. As a matter of fact, because sometimes you get caught somewhere in Latin America, there’s no ATM, or there’s no way for you to get some local currency or your car doesn’t work. You go to the ATM and your cart is not supported.
And I’m like, man, shoot, how we gonna get some money to buy some food or do certain things like locally, but you always find Bitcoiners everywhere. You always find people actually who very much understand [01:18:51] how Lightning works and stuff and they can exchange value and like really do commerce.
And I think actually just how it can be used especially like on a global stage.
Saifedean Ammous: Yeah, I agree. Now the most important question I’ve been meaning to ask you, from this whole thing, how are we gonna orange pill Sadio Mané? You told me your brother knew him, huh?
Fodé Diop: Yeah. Actually my brother actually knows him because actually he’s from south of Senegal.
It’s like another region actually. Like those guys are like really athletes, man. A lot of the people who are like judo champions and soccer champions, actually a lot of them come from there. Like great runners, like really strong guys, man. So yeah, but him, yeah, I think like we might have to like, maybe you might have to invite him and try, maybe try to get him on the show and see if you can talk to them and maybe actually elegantly like in the orange pill him, I think it will actually work, but yeah, but he’s an amazing person, man.
Very simple, very humble. And I mean for, I never been in personally, but I believe he’s a very humble guy and might be actually open minded to see how we can maybe see Bitcoin as a tool for us [01:19:51] to help us move forward. So I would say that, yeah, try to get him on the show, trying to get him on the show, I think is important.
Saifedean Ammous: I’d love to, I’d love to try it, but love to find a way to get to him, he’s just left my team, I’m a Liverpool fan. He just left Liverpool, but I still admire and respect him. He’s he was incredible six years. You just could always count on him to turn up, do his best. He was just an incredibly committed and talented athlete.
Yeah. And he didn’t get as much attention as Salah. They’re both great, but let’s be fair. Salah scores a little bit more goals. So man, didn’t get quite the credit that he deserves, but he’s been incredible and as you say, the things that we hear about them as an individual, like he’s got this very old broken phone that he always carries.
He never buys a new phone. He said he refuses to play video games. He said, no, this is just gonna get in the way of my career. And he’s never played video games.
Fodé Diop: Yeah. Have you seen where he grew up? Have you actually seen like the village where he grew up at? [01:20:51] It’s fascinating, man.
Even for me for me the shows like actually like resilience man, like those kind of people, like always inspired man. Like my uncle, actually, one of my uncles who was the ambassador of Senegal in Brazil. If you see a village where he grew up, you’re like, okay, how can a person who grew up in his environment become a diplomat?
Do you know what I’m saying? To me actually it shows like resilience, man. So I love those stories, man, because they’re very inspiring. And for the kids, it’s very important that they keep seeing these things actually happening.
Saifedean Ammous: This is what I love about football.
Somebody like Sadio Mané, now he’s donated so much money to his village. He’s made his village so much infrastructure, and now he’s inspired so many millions of kids in Senegal and all over the world who otherwise, they might not have something to inspire them. But now yeah, it shows that it doesn’t matter how poor you are, get out there, play football, be committed, don’t smoke, don’t drink, don’t destroy your health, and you could be the next Sadio Mané. And I think that’s enormously powerful. as a motivation and it just [01:21:51] absolutely just need to add Bitcoin to it.
Fodé Diop: And also like strengths about how to handle failure because Senegal won the African cup this year.
We actually won, we beat actually Egypt, whatever. First time, yes. It’s surprising, but guess what? He missed a penalty then he made then he made a second one. Right when you missed the first penalty, everybody couldn’t believe actually Sadio Mané missed the penalty, man.
This is a guy, everybody looking up like, oh, ah, whatever. But the way that he was composed, the way that he still went back again and shot this last, the last shot and still help us win. It’s just man, I’m telling you, man, it’s like a movie, man. It’s like a fairy tale story. You know what I’m saying?
It is for somebody who’ll be that strong to be that resilient man, which means that you can fail right now in front of the whole world. It’s a global game, everybody watching it. Your country is like residing behind you and you come in and miss this critical penalty. But yet you come in there and you just basically still score the last one to help us win this thing, man.
I’m oh man. It give me like goosebumps man.
Saifedean Ammous: I’ve always been a fan of Senegalese football. I remember 2002 world cup when you beat [01:22:51] France in the opening game, El Hadji Diouf.
Fodé Diop: Man, our president got on top of a car to dance in the middle of the street, it was amazing man. We beat France, man. I’m telling you, it’s like a horror story with France, man. It’s like a bad boyfriend. You know what I’m saying?
Saifedean Ammous: I know. And they were world champions at that time and you knock them out of the first round.
Fodé Diop: Went out in the first round, man.
It was the sweetest feeling in the world.
Saifedean Ammous: It was the footballing equivalent of what Bitcoin is gonna do to the CFA.
Fodé Diop: Exactly. And also I don’t wanna specify, man. I said this last time in Norway, right? I don’t have nothing against French people, man. I have French friends, a French girlfriend, all these things, I don’t have a problem with the French population.
What I have problem actually with against is the French institution, the people who will the power in France that make those decisions that keep these African countries impoverished. That’s what I have a problem with, but I don’t have a problem with no single French person.
I will travel to France. I’m going to France, basically south in August next month for surfing [01:23:51] Bitcoin in BRX, I’m invited, I’ll be a speaker there. So I don’t have any problem with French society or whatnot. What I’m saying is please wake up and look at the situation that’s happening and how do we basically put a stop to this thing again?
Put a stop to this horrible thing that’s happening today. Because again, with with this currency, we will never be able to develop ourselves. Like these countries will never be able to get out of poverty, man. And people think that, oh, Africans are lazy, this and that, whatever, because what they see in the news, Africans are not lazy, man.
Africans wanna work hard. But the reality is that this African countries are poor because basically over exploitation. That’s really what it is and they do in a very covert way. This is what I see.
Saifedean Ammous: This is really the key thing that, africa countries have never really had a hard money standard.
They went from all these colonial monies to even when they got independence, they went on easy fiat money. So Western European countries and most industrialized countries, they went on a [01:24:51] gold standard, so they did have a period in which people could work and save and accumulate wealth.
And think about the long term. And that’s the building block for economic growth, for economic production, economic civilization, everything that’s the idea. Once people have the belief that I could work today and harvest tomorrow, and then keep the proceeds of my harvest for 10 years. And 10 years later, I can still eat from this because I have this magical technology called money, which transfers value, once you have that people start becoming a lot more productive and a lot more secure and a lot more future focus. This is a very strong point I keep repeating in my work. Yes, the hardness of our money is what gives us future orientation, and it’s impossible to develop this if you live in a place where the money is constantly losing value.
So you mentioned your story of your own father’s savings divided by 50%, 90% of people for whom this has happened, they’re not going to [01:25:51] save in the same way as their father has saved. Why would I save? I could have think you’re gonna always think about all the things you could have bought along the way.
All the parties you could have gone to all the better cars you could have bought all those years that you could have spent that money on that money wouldn’t have been lost. And so people’s incentive to work and people’s incentives to save are very strongly correlated to the hardness of the money.
Fodé Diop: Absolutely. And actually money, hard money was there in Africa before the Europeans. You actually wonder how do the society operate without trap money before before like really families, women were at the core of the families. Like women stayed home and managed the household managed the money itself, saved were able to like really distribute this money and like really raise the correct actually household. The men was in the field, they were farming, basically generating revenue for the family itself and coming home, and the woman took care of the household, but the men were in the fields and mostly farmers.
So the women ran basically the household, what happened [01:26:51] when fiat came and the European came, they basically brought this like funny money. Now you had to pay taxes in this particular money. So now all of a sudden the man had to go and work for this for actually for this fiat money.
And they became head of the household. So what happens? We know what men want. They wanna get more wives, they wanna do more things, they’re spending money, they’re not really saving actually the way they were supposed to save. And not only they gave them this money basically to save for the future, but they didn’t realize that actually this money is being inflated and they really, it’s like really funny money, it’s not even real money.
So even at the core, the structure of the African basically culture was basically flipped upside down when basically flat money was even introduced in its particular nations interesting in his society.
Saifedean Ammous: So before the CFA, what was the predominant thing that your family would’ve used as money?
Fodé Diop: So let’s say even back in those days, so of course,
Saifedean Ammous: When was the CFA introduced in Senegal?
Fodé Diop: 1960. So before that, what the central bank started when [01:27:51] the central bank was basically set up, I’m not sure exactly if they used like the, those French coins or the Euro coins, whatever, before, but actually let’s say even let’s go back a little bit before.
So it was mostly salt beads and then beads, and then also like those shells, right? But what happened with the beads right? When the Europeans got there and they realized that Africans, when you were using beads, like those was actually those glass beads. They went back to Europe and manufactured a lot of these glass beads came back and pretty much like just deappreciated the money. Actually literally what happened. But that’s actually what was happening before. So mostly salt was a huge actually way to basically preserve money because salt was mostly harvested on the coast itself, but they had to be transported through the desert itself through basically, because folks had to use it when they go actually basically inside the continent itself.
So that’s actually how they had to basically do bar and of course gold because of the million empire and back in those days and all that story. But we wouldn’t have enough time to get into that today.
Saifedean Ammous: Yeah. But so like in the 1950s, what would your father or grandfather would’ve been saving in at that point, [01:28:51] or mother or grandmother?
Fodé Diop: Actually, I don’t wanna give you actually false information. I have verify actually really when the CFA came into effect (it was on December 26th, 1945), but they did have some kind of currencies back then. So actually they were printing basically, I believe in the fifties to the sixties itself. But I don’t know actually what happened prior to that actually what they were using. I gotta double check that information.
Saifedean Ammous: Okay we’ll add an addendum to the podcast before we release it, fact checking this. Peter has a question for you.
Peter Young: Thanks for sharing all that Fodé, that was a fascinating discussion. I wanted to ask a question, about your experiences in El Salvador where we first met and how they compare to your experiences in west Africa. So I’m particularly interested in how people are actually using Bitcoin on the ground.
Did you notice any kind of important differences between the way people are using Bitcoin in the two regions?
Fodé Diop: I [01:29:51] would say, okay. I would say people in El Salvador because of the Bitcoin Beach wallet, I believe like they actually understand how to use BTC. Because there’s a main difference itself. Because there people basically, they had two wallets at the time when I was in Salvador, they had a Strike wallet, but they also had a Bitcoin Beach wallet. So what they want to basically preserve the currency, they will transfer the BTC to their Strike wallet because they actually, the Strike wallet had a USD balance that was pretty much fixed. So because actually displayed you’re pretty much like holding USD in your Strike wallet. So when they wanted save, they will basically switch it over. And when they wanna spend the BTC, then they can like really transfer between the Bitcoin Beach wallet and the Strike wallet itself. Senegal actually, I don’t necessarily see that the people actually wanna basically hold the like stablecoins or BTC. What I see actually mostly people they actually hold in Senegal is they will go basically straight to the basically stablecoins. Because they felt like BTC were just maybe too volatile or whatnot.
Some of the people who are more speculative actually, but the people who actually understood Bitcoin and that I’ve [01:30:51] been holding it for a long time are the only ones that I see that they basically hold a balance of BTC and a balance of basically stable coins. But the average person that I saw actually in Senegal, most of them would hold like a small I’m on the BTC, but mostly most of the bulk of their money in the stable coins.
And that’s what I see basically, most of the difference. And also, I don’t see, obviously on the ground in Senegal, there are not too many people taking BTC as a form of payment. We don’t have too many like point of sale systems basically for BTC and merchants don’t wanna accept it because they don’t understand it.
So only a few here near pepper in the city actually happen. I think maybe like less than 10, but the people who are, who I know, people who are much more actually educated about this. Yeah. And they wanna accept like BTC for, one girl actually that is at home, they sell basically fish, like fresh fish from the ocean and they accepted by actually BTC as payment.
So we are actually getting like more like rare cases happening. And I think basically as more people understand how to basically accept actually BTC as payments, because again, we have tourists, we have nomads, right? Those nomads usually actually have BTC in their wallets. We have people from Spain, from Italy, from France, from US [01:31:51] actually, because they come to Senegal because cheap, they want buy real estate, hang out, cheap, buy cheap food, live there, maybe work remote.
There’s a company, I think it’s called Remote Year, they actually have a presence in Senegal now. It’s very strong, right? So I go back to like digital nomads, because them, they are very much so world traveled. They understand how money works. They actually have a problem with switching money everywhere that they go.
So they know how to use this BTC. And they want to like basically spend it locally. I believe like El Salvador has a same situation because El Salvador not only actually the Bitcoin benefit, but El Salvador has benefited from tourism right? Every year, it’s more people going to El Salvador who would never, ever go to El Salvador because they heard about bad things about gangs and blah, blah, blah.
But they get on the ground. They’re like, oh, it’s not that bad, actually, it’s fairly safe country. People like here living their lives, doing they doing their thing. But they’re curious to know about Bitcoin legal tender, and they show up in El Salvador and they see what you see what’s happening.
I believe actually in Africa, we need to have the same thing. But right now, of course, Central African Republic, because in situation locally, nobody’s really gonna get up and say, okay, I’m gonna go co-work in [01:32:51] Central African Republic. You know what I’m saying? That’s not really the plan. But I believe like in places like Senegal or like Ghana, Dakar, like in west Africa, they are like very modern.
Senegal has never been taken over by the military. We have, it’s one of the only countries in west Africa that has never been taken over by the military. We have never had a coup we always had some kind of democratic actually president elect itself. So it’s a very stable country.
So I think in those countries, if you can open ’em up, make much nicer for basically digital nomads that will come and actually spend more time there, but they wanna spend money in the local economy they can do. So basically with BTC and lightning, it’s a very easy way and a very convenient way for you to basically spend money.
So I think again, go back education, if you can educate more to basically install point sale systems except for more Bitcoin, basically it makes it simpler for people to basically come in there and spend Bitcoin. And also, again, go back again to my academy, the reason actually, why I had it initially, I said, okay, we got a problem with economy here.
These kids are going in the they’re going in the ocean and dying, trying to cross and go to Europe. We see it every day. They cross to the [01:33:51] desert. They had been enslaved in Libya, like talking about like horrible things happening to Africans, sub-saharan Africans trying to cross the desert, trying to go to the ocean and trying to find a better life in Europe.
So since we have the youngest population in the world, and these kids are very smart because YouTube and because of social media and all these things, whatever. So to me, it was very important to say, okay, say, Hey, listen, we got this global money, you can basically become a software engineer, you don’t have to go anywhere, you can stay exactly where you are, you don’t have to worry about finding a job locally, because maybe it’s hard to find a job where you are, unless maybe your aunt or your uncle works at a particular company. You have to know someone to be able to get a job somewhere.
You don’t have to worry about none of that. You can worry about the global, this global monetary system called Bitcoin. You can become a software engineer. You can work from right where you are and get paid in BTC, directly to your computer or directly to your basically mobile device. And it changes the whole word because at that point, what actually, what it does is it basically stops brain drain automatically, right?
Because you thinking that you might find a better life somewhere, but we all know that there’s nothing in Europe. And I don’t wanna [01:34:51] say I don’t wanna say this to be like condescend to Europe or whatever. But I grew up in America, there’s nothing in Europe. Absolutely nothing. They don’t have energy.
They don’t have raw materials. Everything that they have is because Africans. Everything that does in Europe today is because basically they wasn’t actually exploited this particular continent. So this was like Hollywood, right? Hollywood movies make you dream. Movies wanna make you wanna go to America?
Movies are pretty much like an hour and a half commercial. That’s really what it is. When you watch a movie, you wanna go to America, you wanna see this grand view thing, transformers, all these things, whatever. But it’s all a dream. We’ve had all these things all along. We had the richest continent in the world.
We have all the resources, 90% of the resources, things that are in your mobile device today come from Africa. So how can we be poor? Like how is it possible? Again, it’s like lack of information, lack of in industrialization, because again, the European didn’t want for us to basically have industries.
So we take this raw materials, send it to them and then they send us back this basically the finished product. [01:35:51] You heard about the stories in Ghana, where people are basically cocoa farmers that have never tasted chocolate, right? You farm cocoa. You have never in your life tasted chocolate, man.
It’s a paradox. You know what I’m saying? So the idea is like, how do we basically make it where we can keep stuff again in the continent itself. But the only way to do so is because the reason people don’t have actually respect for Africans men is because the way basically that the financial system is cured, man.
But since that, nobody wants us to basically participate in this part. In this financial system, we have to build a parallel system that will help us basically circumvent all this basically red taping. That’s really what it is, man. And that’s how I see it. I know it’s a long way of actually answer your question, but it’s how I see Africa basically difference between Africa and like El Salvador.
I think that’s how we can basically like really bring more adoption there and like really like on the ground, basically be able to change things and think about those things actually in the future. And sorry, it’s a long winded answer, but this is what I think.
Peter Young: I was saying it’s really encouraging to hear those developments.[01:36:51]
We’ve had the internet, obviously making jobs more global, but now we have money doing it as well. I’m looking forward to coming and seeing how it’s developing in that region.
Fodé Diop: That’s right, that’s right. You don’t have to worry about banks. You don’t have to worry about getting paid by the international company.
You can work from anybody in anywhere in the world right where you are and you can get paid in BDC, right? To your local wallet. To me, that’s a very powerful concept. You don’t have to worry because again, it’s like nepotism everywhere in Africa, man, for you to work somewhere, you have to know someone or your family gotta work somewhere there for you to get a job. And to get a job in Africa, it’s mostly who do you know?
It’s a reality, but then you want it to be like merit based, if I got skills like a market in international world, I wanna be able to sell my skills in a global market and get paid what I deserve and directly to me.
And to me, that’s a very powerful concept. That’s why to me like software engineering actually allows for that to happen. Software is like this really amazing thing, man, that comes from your brain to your computer. It’s amazing.
Saifedean Ammous: Yeah. I agree with you. I’m not a programmer [01:37:51] myself, but I think everybody who is not currently retired and happy to retired or working a highly productive job with a very high income you should probably just quit whatever it is that you’re doing, spend six months learning to code and then learn, and then work as a programmer.
It’s arguably a much more productive thing to do because the amount of productivity that you get outta writing a few lines of code is far larger than pretty much anything. I think very few things can compare very few skills can be as productive because you write a few lines of codes and then millions of machines all over the world that do something exactly a result.
And actually, yes, they make things happen. They increase value for other people. So that’s the most powerful avenue. Very few people can muster that kind of productivity. You could be a very good manager. You could be a very good artist, very good writer in order to have that kind of productivity that an average that an [01:38:51] average programmer can get from just writing code.
That is not even, you don’t have to be the Steve Jobs of programming. You don’t have to be the Sadio Mané, you just need to turn up and be a programmer and you could have a much higher productivity than in other jobs. And that’s why soon we’re hosting Amjad Massad who’s the CEO of Replit, which is a company that allows people to learn how to code.
Fodé Diop: I love Replit.
Saifedean Ammous: Oh yeah, you use it?
Fodé Diop: Oh yeah. I actually use it. Actually, I went back to school in 2019 in San Francisco. And in my school actually, that’s what they use. It was like a new day kind of engineering program school, but Replit is amazing, man.
Because to me, the ability to be able to code in the browser is very important. The browser is like the distributed tool of the world. And nobody thinks about that, man. That’s why I was so excited about the first iPhone. When safari came in the iPhone, safari changed the changed the phone.
The browser changed the phone itself because before the iPhone, you could only browse the internet with this thing called WAP. [01:39:51] It was like a protocol that really have to like really very punky for you to basically do these things right more around. Yeah. But now think about it.
Now you can have a $200 computer, like a Chromebook and you can basically code in the browser itself. You don’t have to install anything. That’s why definitely to me is amazing because a teacher can have it. You can distribute your homeworks through, students can basically submit their homework through there.
It could be actually graded automatically because obviously they can either somebody the right or the wrong answer. Yeah. So it’s very simple actually to do so the browser basically is actually revolutionizing, actually computing.
Saifedean Ammous: Yeah. I think the combination of Replit and Bitcoin is likely going to make so many people’s lives so much better over the next few decades. Think just the potential that, you know, at this point, yeah, not even a $200 Chromebook, like a $50 phone, you get a $50 Android phone and learn to code and then start to code as a job on that $50 phone. And then you could be earning [01:40:51] $5,000 a day if you get good at it.
And you don’t need anything else, like you don’t need a fancy education. You don’t need to go to a fancy college. You don’t need a professor. You just need any internet accessible device and a browser, you don’t even need a sophisticated device, it’s extremely powerful.
Fodé Diop: It’s powerful, accessible. And also again what you talked about earlier is that, software is amazing because it’s all about basically write once, distribute everywhere. So actually the, it’s like a nominal cost of like basically distribution.
It’s actually becomes even cheaper over time. You basically write once. And I think I actually heard this from like Microsoft back in the days. You basically write once and distribute everywhere, man. And this’s, what’s so amazing about it, and like I said, you can do it from like a mobile device.
Saifedean Ammous: Yeah, absolutely. All right, we’ve got one more question for you from Nathan.
Nathan Reed: Yes, sir. You were accepted to Emporia State? Yes. Did you ever attend?
Fodé Diop: Yes, I did actually, 94. Yeah.
Nathan Reed: [01:41:51] Yeah. You you probably played in Allen Fieldhouse.
Fodé Diop: Yes, I actually, yeah, I was a walk-on but it didn’t quite actually didn’t quite work out, man, because of course I grew up in the nineties.
I was like a big fan of Michael Jordan. Michael Jordan changed my life, man. You can see me like I’m always bald. I always like trying to have the Michael Jordan look my entire life. But what happens is man, like sometimes when you are a kid you don’t really have the, especially growing up in Africa, I didn’t understand about the world yet actually. Because mind you, when I get to Kansas in Emporia, that was my first time leaving the African continent. Actually it was my first time leaving my home country, mind you, and I get to Kansas, I don’t even speak english. As a matter of fact, like I’m just like having a hard time understanding even how the US works.
I’m in there by myself, basically without my family for the first time. And I’m trying to be a walkon then actually the reality of actually of America hit me. And I was telling Peter earlier, I was sitting in Africa dreaming about America, watching basketball games, watching football games, [01:42:51] watching movies.
I had this crazy idea about America, right? The streets was basically paved in gold and all these things. As soon as I land, I’m like, oh my God, this is a whole different reality. There’s this thing called minimum wage. You gotta work for per hour and get paid this peanuts basically. So I’m trying to work in the morning, clean the library in the morning, go to study in, go to study actually a nine o’clock, workout and try to do it all over again. Do my homework and whatever.
I told my dad, I said, this is impossible. All these dreams that I had about like America, about playing basketball, being like Michael Jordan, and also I got here and I realized that every single kid wanted to be like Mike, and all these kids have been playing basketball since they were two years old.
Their families are grooming them to be like basketball players and all these things. So I’m thinking like, oh, I’m gonna show up and just be like, 3 billion kids trying to do the same thing. So I got in here, I called my dad.
I said, dad, I think I’m gonna focus on programming. And actually funny enough, man. I couldn’t speak English, cause actually my father was a math teacher, so he was very, I was into like math, like really early. So I taught myself how to code and I got my [01:43:51] first job actually as a programmer in Bloomington, Minnesota. Once I left Kansas and I became actually a developer at the age of 21 and I was actually writing insurance for applied systems in Minnesota, writing homeowners in auto insurance policies, software.
Nathan Reed: So how long were you at Emporia?
Fodé Diop: I was there for one year. I was there from 94 to 95.
Nathan Reed: I have a question, in Senegal, what is the impact of China? You talked about Russia, but what about China? Because they’re all over Africa.
Fodé Diop: Yes. So in Senegal itself right now in my home country, every year I go, they never used to be a Chinatown.
And now there’s a huge China town in Senegal. As a matter of fact, right? There’s like Chinese are like coming implemented themselves. They’re buying like a lot of real estate. They are doing a lot of actually the construction work for the new roads and new bridges and all those things, the same they are doing in east Africa for that built initiative, whatever they call it.
And it’s, we don’t have like really [01:44:51] was a big grant mean train systems or whatnot, but they are very much so present. They are there, they are buying a lot of the local resources. Senegal is like a major actually exporter of peanut.
And they are like buying a lot of the stuff. They are buying like a lot of resources and are very much so present. And I see ’em more and more in the country itself. So I don’t know exactly at what point, like toward level they have like economical impact in Senegal itself, specifically itself, or I maybe I have to do more research, but they are very much so present.
And I do, they’re doing a lot of import export business out, outta out of Africa, sure.
Nathan Reed: Yeah. And I just wanted to comment, your academy. I’m not sure exactly what all of you’re doing there. What I read about it in your description. I was a developer for 45 years, I picked up a book on mastering Bitcoin and I got 60 pages into it [01:45:51] and I couldn’t absorb any of it.
If you don’t have extremely strong encryption and mass skills, and you’re trying to train at the second layer if I understand.
Fodé Diop: Yes, exactly. So basically not actually at a protocol level. I think like it’s important. If somebody’s curious, they can actually dive deeper.
And they can go lower and actually learn actually protocol level encryption and like private key, public key encryption and all those things. But I believe same as basically Jimmy Song’s book, Programming Bitcoin From Scratch, but I believe actually that’s again, that’s for a small subset of the population.
I believe actually most people who already have experience building, mobile applications actually, or web applications, they can actually pick up building applications on top of Bitcoin itself. Because at that time you can know how to basically how the protocol works, but you don’t actually necessarily have to know how to program the lower level.
Nathan Reed: Yeah, [01:46:51] I use databases, but I don’t understand.
Fodé Diop: Yeah, but honestly, like the way actually that I explained it is just basically, it’s pretty much like a data structure. It’s like a double link list. We got basically a node while pointing backwards and forward with other one it’s immutable.
And then if you can look at it that way, basically as a simple data structure, I think it’s actually much more simple to explain. And data structure is basically governed by encryption.
Nathan Reed: One last quick question, do you see much use for oracles? Do you see that?
Fodé Diop: Yes. Oracles are basically still very useful as a matter of fact, because I believe like they’re a core central piece of distributed systems itself. Because unfortunately the blockchains are like really dumb systems. It’s like a really, especially if you look at Bitcoin itself, it’s pretty much like a dumb accounting software. It just basically has inputs and outputs.
And that’s basically very automatic and generates a block within minutes. Very, pretty much mechanical itself. So if you wanna have outside world information, [01:47:51] especially let’s say the price of currency, the price of the USD, where do you get it from? That’s very important.
So you still need like a outside system to be able to basically get, actually grab this information and bring it back basically to the blockchain. If you wanna have what do you call actually smart contracting and so forth. So far right now, the only ones that I’ve seen being developed actually on Bitcoin is from a company out of Chicago.
What are they called again? Sorry, I forgot. I forgot what they’re called, but they actually, it’s a company that makes like this thing called discrete log contracts, DLCs. But for DLCs, even, basically for DLCs to work, they need to have outside information. So you need to have basically systems that run like these actually Oracle systems.
Unfortunately, they are, they’re also like, like pretty much centralized. So those two things, right? Where do you get the price of USD which is like really the base price of everything for one, and also like where do you get the time? Who is actually charge of the time?
Nobody acually thinks about that.
Nathan Reed: It looks to me like there could [01:48:51] be a market for just building an Oracle. In other words, like a trusted source.
Fodé Diop: That’s right, that’s right.
Nathan Reed: Or some unique piece of information. But I’m not seeing a lot of that yet. Is it just not exposed and I’m not aware?
Fodé Diop: I would say I would say look at like DLCs, like actually discre log actually contracts, and you can see how to implement them. They actually have the blog is very good. The company called suredbits out of Chicago.
They are like really, very much so thinking about those systems and if you look at their blog, they constantly talk about actually smart contracts and Oracles and how they were thinking about building those in a very distributed manner and so forth. So very important, yeah. Suredbits, exactly. That’s the one. Amazing guys. Actually. Yeah, definitely check out their blog.
Nathan Reed: Yeah. Don’t be afraid to come back to Kansas!
Fodé Diop: Yes, actually, I haven’t been, I haven’t been [01:49:51] since I left, man, it was crazy. It was a, it was quite a actually crazy experience, man.
I just yeah, I got there and then, oh man, it was like my first year, man. I couldn’t, it was like a movie, man. I didn’t understand English, man. I couldn’t talk to nobody. It was rough.
Nathan Reed: Good to speak to you. Thank you.
Fodé Diop: Thank you so much. Likewise, thank you.
Saifedean Ammous: All right. Fodé thank you so much, this has been absolutely fascinating and inspiring.
Fodé Diop: Oh, thank you for having me. Thank you.
Saifedean Ammous: I’m really looking forward to hearing more about what you guys get up to and having you back on again, to tell us more about your progress on all of those things. Lightning Central African Republic, and most importantly, of course, Sadio Mané.
Fodé Diop: Exactly. I also would love to extend an invitation to you because I also launched my own personal podcast yesterday called the yeah. the Fodé Diop Radio Show. Yes. So one of these days also, like when you’re free, I would love to pick your brain about actually a few topics that I read on the book itself.
And maybe we can talk more about actually the book specifically, because I feel like a lot more people actually need to know about your book and maybe [01:50:51] like really get inspired, actually.
Saifedean Ammous: Sure! I’d be happy to return the favor. Thank you so much. I’d be happy to!
Fodé Diop: That’d be awesome. Thank you for having me. I really appreciate it, man. This was a blast!
Saifedean Ammous: Thank you. Thank you, sir. Pleasure is all mine. Take care.
Fodé Diop: Absolutely, thank you. Nice to meet you all guys. Thank you so much. Cheers!