Baking Bread in a Refugee Camp Just Got Easier 0 190

When Zulfiqar Deo and Ondrej Dusilek first visited Jordan in 2016 to conduct interviews in the Zaatari UN refugee camp, they found a paradox. Nearly a hundred thousand refugees, displaced by the war in Syria, were living in a ‘camp’ that’s looking more and more like a permanent settlement every year. Many of these refugees were educated professionals or business people in Syria. But in Zaatari they’re not allowed to work. Though the Jordanian government provides $870 million in annual support, they have restrictions on refugee work permits in order to protect their own economy.

Nevertheless, businesses naturally pop up in a community of this size. Deo, who was detained at the airport, communicated with Dusilek and their support team in the camp, including advisors from PriceWaterhouse Cooper and SIX Group, a coach and mentor from the F10 fintech incubator, and a handful of volunteers. They estimated that three thousand microbusinesses helped circulate $11 million per month in the Zaatari community.

Invisible Businesses

Without access to capital, though, the refugee’s businesses were struggling. A wedding dress rental company couldn’t grow to meet the demands of the community. A baker wanted to scale up his shop but couldn’t afford the machine that would make it possible. “Refugee entrepreneurs are a significant global population not being served,” Deo told The Block Talk earlier this week. “They cannot access a business bank account. They have no formal record that their business even exists,” says Deo. “Even as successful entrepreneurs, they’re financially excluded.”

This ‘significant global population’ is growing fast. Over 68 million people worldwide have been displaced by violence, and that number is growing by 300 thousand people each year. If this unprecedented upsurge continues, we’re looking at a near future in which one out of every 100 people on earth is a refugee.

Part of the refugee experience is disconnection. But we have the technology to connect people. Can we introduce it to regions like Zaatari to engage refugees more directly with the global community? Can we use the blockchain to finance refugee entrepreneurs and stimulate micro-economies in camps and settlements?

Boosting the World’s Underserved Through Technology

That’s the thinking behind BizGees, the company Deo and Dusilek launched to bring microfinancing to refugees. They want to support refugee-owned small businesses with interest-free loans, inventory, six months of ongoing support, and access to amenities from partner companies, like WSV’s ‘business in a box’ toolkit. By Deo’s calculation, a support package like this lowers the risk of business failure from 90 percent (which is close to normal for first time entrepreneurs, although these numbers are tricky to nail down) to a mere 10 percent.

“Refugees naturally nurture the same skills entrepreneurs have just out of necessity,” Deo observes. He notes that the creativity, initiative and ownership necessary for their survival are also traits commonly associated with entrepreneurs. “So why not support them?”

With the support packages Deo designed, 3-5 refugees who typically live on $5 per day could launch a startup or expand an existing microbusiness. Within a year, the microbusiness could become a small business employing 10 more people, who circulate their pay in the local markets and stimulate the whole community. When the loan is repaid after a year and a half, it’s reinvested, providing loans to another business.

Eventually, because of the transparent, chronological way the blockchain stores data, refugee entrepreneurs will build a credit history acceptable to most local banks, better positioning them for traditional finance like they may have had access to back home.

Finding The Right Environment

But there was a problem. Although their model is tested, BizGees couldn’t launch it in Zaatari because of the government’s work restrictions. “We had to move away from Jordan,” Deo said a bit ruefully, “and look for a different environment that allows refugees to work.” That led his team to Uganda, where tens of thousands of refugees have been displaced over the past decade by violence from a Christian terrorist group called the The Lord’s Resistance Army (LRA), operating in northern Uganda, South Sudan, the Central African Republic, and the Democratic Republic of the Congo.

According to Deo, some of the people in Uganda’s camps “didn’t take kindly to the service we were offering at first, asking ‘why is that person getting support and not us?’”

They had to work to re-educate the community on how the model brings long-term returns to everyone, by the money getting re-loaned and by financially stimulating local marketplaces. Now, Deo says, they’ve identified the refugees they can fund and the first microbusinesses should be up and running by the end of this month.

Working in Stressed Communities

Working in refugee camps isn’t easy. “It’s a very complex environment,” Deo says. “In addition to the financial issues they’re facing, there are social issues, psychological issues, most of them have post traumatic stress.” He notes that displacement alone causes mental health concerns, let alone the trauma of losing or being separated from loved ones. “You have to take into account the impact those traumas have as far as how they engage with the public and how they take control of their own lives.”

Consequently, the goal of BizGees isn’t just financial or technological. Their website asserts the importance of entrepreneurship as a way for people to take back ownership of their lives by building confidence and self-worth. Instead of just trying to make a buck, Deo, who has a background in international politics and NGOs as well as business, wants to meet a need.

How Crowdfunding Meets These Needs

BizGees is able to offer loans without interest or collateral because of the way they crowdfund them. Ninety percent of everything they raise goes to the refugees, while the other 10 percent supports BizGees’ operations, which are partially volunteer run.

The public participates through crowdfunding campaigns including art auctions, presales of products from post conflict zones, and cryptomining.

“The reason we’re using crowdfunding is to engage the global community more directly with the refugee experience,” says Deo. “The idea is to personalize it and help individuals to make a real social impact.”

Through blockchain’s ability to connect people directly without a third party, Deo sees a future where a group of individual financiers could get together to sponsor one refugee microbusiness and communicate with them directly. “They’re no longer reliant on third parties to know what’s going on in rural Uganda,” he says. “They have direct access.”

Getting People Socially Engaged

Direct communication is key because it creates the social engagement that is one of Deo’s overarching goals. Most people have no idea what a refugee camp is like, who’s in them, or what they’re facing on a day to day basis, he notes, citing that the average refugee stays on what’s supposed to be a temporary refugee status for 17 years (the U.S. State Department says 26 years on average for protracted refugees). “The support base for refugees is focused on disaster relief, for the first 6 months or so,” Deo says.

“There’s a big gap between the actual experience of refugee populations across the world and how we perceive their experiences,” he says. “We’re looking to use social engagement as a way to narrow that gap as much as possible.”

That’s also why he’s enlisting volunteers to participate in the work, both on the ground in the refugee camps and at BizGee’s headquarters in London. Deo mentioned an American volunteer who came to help with promotional material, website stuff, and office operations. “Her understanding of the refugee experience on day one was very different than it was on week seven,” he says. That in itself he considers a small success.

Goal: A Thousand Refugee Businesses Thriving

As for larger successes and longer term goals, Deo hopes to support 1,000 refugee businesses in the next three years, serving populations indefinitely in Latin America and Asia as well as Africa.

Blockchain technology can work for humanity. Models like Deo’s, which supports at least seven of the UN Sustainable Development Goals, identify something the blockchain can do that world badly needs. This is what we need to see more of from blockchain developers.

The refugee crisis is escalating, but hope can grow within the camps as long as people can live like people. As long as bakers can keep baking, and families can rent their wedding dresses.

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A tribal member of the Choctaw Nation, Brian grew up in the Silicon valley under the technological mentorship of Steve Wozniak. He's lived, worked and traveled all over the world, and now writes and makes films in the Pacific Northwest.

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The Block Talk Award Winners Announced 1 1110

Thanks to everyone for submitting your favorite blockchain innovators and influencers. Our editorial team had a great time learning about new projects and individuals that are building a foundation for our future with blockchain technology, and realizing amazing technological feats in the present.

While it was difficult to select just one project or individual in each category, we’re excited to announce the winners of our first inaugural Block Talk Awards.

  • Best ICO Analysis & Commentary – Tatiana Koffman, Various Outlets
  • Most Engaged Community – Rod Turner, Various Outlets
  • Favorite Blockchain Blogger – Rachel Wolfson, Forbes
  • Best Crypto Journalist – Jordan French, The Street
  • Innovative Female Founder – Amber Baldet, Clovyr
  • Best Podcast Host(s) – Joel Comm and Travis Wright, Bad Crypto
  • Favorite Blockchain Event Host – Adryenn Ashley, Loly.io
  • Top Crypto Speaker – Ian Balina, Crypto World Tour
  • Most Innovative Blockchain CEO – Trevor Koverko, Polymath
  • Top Social Entrepreneur – Evan Caron, Swytch

Winners in each category will receive a $1500 media credit on The Block Talk, access to a network of TBT Award honorees, and VIP access to TBT events in 2019.

Defrauding Crypto CEO Josh Garza  Sentenced in Landmark Case 0 98

The disgraced former CEO of fraudulent crypto company GAW Miners has reached the end of a legal saga spanning more than three years. Josh Garza has been sentenced to 21 months in prison and payments of $9,182,000 in damages. His prison term will be followed by three years of supervised release, including six months of home confinement.

US Attorney for the District of Connecticut John H. Durham announced the sentence, which follows Garza’s guilty plea to wire fraud.

How GAW Miners Lost Their Zen

GAW Miners started as a cloud mining service. Fraud allegations began to emerge in 2014, and formal charges followed. The SEC accused GAW with acting as a Ponzi scheme by selling more crypto mining power than they really had. Around that time, GAW also peddled its token, PayCoin, which they promised had a $20 ‘floor.’ That floor dropped out in 2015, to the ire of beswindled token holders. By the end of January, one PayCoin was worth less than $2.

According to the Department of Justice, Garza “stated that the market value of a single paycoin would not fall below $20 per unit because Garza’s companies had a reserve of $100 million that the companies would use to purchase paycoins to drive up its price. In fact, no such reserve existed.”

Nor did an $8 million transaction in which GAW’s parent company allegedly purchased controlling shares of ZenMiner (another company founded and operated by Garza). “Garza made multiple false statements related to the scheme,” the release states, “to generate business and attract customers and investors.”

The PayCoin collapse initiated the undoing of GAW and ultimately of Garza. GAW tried to bounce back with some unsuccessful endeavors like a crypto exchange called Mineral and a platform for making Amazon purchases called CoinStand, before the company went into default for failing to pay their power bill.

The truth eventually began to come to light after internal emails and documents surfaced, after GAW went under separate investigations by the SEC and the DOJ. A few years later, these investigations have finally resulted in Thursday’s sentence.

Justice and Fraud in CryptoSpace

The sentence is a win for the Department of Justice, which has been puzzling over how to govern the crypto world, and could set precedents for following cases, including investigations already underway.

A Bloomberg study has found that over 80 percent of ICOs are scams. Meanwhile, TechCrunch reports that over 1,000 crypto projects have failed in 2018, and $1.1 billion in cryptocurrencies have been stolen this year, according to CNBC.

The crypto landscape and the justice system clearly have some reckoning to do, but investors need to exercise serious caution in the meantime. Although Garza’s sentence sets a precedent, it’s based on a situation that’s not necessarily unique.

Garza’s Sentence May Not Satisfy Defrauded Victims

Critics of the sentence have pointed out how with good behavior Garza could be out in 18 months, a light load considering his fraudulent acquisitions through PayCoin could’ve totaled $20 million by some estimates, and considering the 20 years of prison time per infraction Garza was facing in court. The lighter sentence was part of a plea deal.

While Garza denied all charges at first, he expressed remorse about his actions in a courtroom statement Thursday, according to CoinDesk. Garza is ordered to report to prison on January 4th, 2019.

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