Founded by Amit Aggarwal, Andrei Kaleis and MVK, Zolango, an ecommerce marketplace has gone live and is offering to buy and sell their products using Bitcoin.
The platform offers more than 1,000 items for sale such as sports equipment, office supplies, jewelry, freelancer services, fashion, electronic accessories, gift cards and books among others.
According to the firm, MVK who grew up in Mlango Kubwa slums in Nairobi, Kenya saw an opportunity to launch the platform to held eradicate extreme poverty and despair. MVK says Mlango Kubwa which means “Big Door” in Swahili –was symbolic of all that was possible for those who were open to it and has lived to that throughout his life and career.
Zolango sellers are charged just one percent commission to help keep prices low. eBay or Amazon by comparison charge monthly fees, referral fees and closing fees along with a percentage of the selling price – which averages around 15 percent – even before fulfillment and shipping costs are incurred. In addition, due to the blockchain, there are no credit card processing or bank fees with Zolango.
With Zolango, all payments go through its escrow system so buyers can shop safely and be assured their products will be delivered as described. In addition, Zolango does not compete with its own sellers, unlike Amazon, which has a line of branded products. Likewise, Zolango commits to keeping seller data wholly private.
The platform works simply. The buyers pay in Bitcoin. The seller receives Bitcoin that is held in escrow in case of returns or defective products. Escrow is automated so the Bitcoin is released in 30 days, unless a buyer raises a claim.
“Zolango is the next phase in the crypto revolution. I call it the Spend and Earn Phase. We picture a Crypto Economy, where people both earn and spend in Bitcoin, and our marketplace is helping that system get traction,” said MVK, who goes by his initials both to reinforce the importance of privacy as well as creativity. “I believe we need to create our own alternate economy and Bitcoin is the protocol, the reserve asset around which the Crypto Economy will revolve. Look, the internet has changed things, we’re now truly global and so we need a global economy with a global currency.”
“Buying and selling on Zolango is not just a better buy/sell experience, it brings the CryptoCurrency revolution one step closer to reality. We need to use Bitcoin as a currency, the way it was meant to be. This will ultimately enhance the value of Bitcoin and make it a more stable form of currency. And Zolango is happy to lead the way in being the face of CryptoCommerce,” he added.
However, we all know how all this is just empty-speech. Buying with Bitcoin has been used as a marketing tool for a number of restaurants in Kenya and by some platforms in reality across Africa. But Bitcoin as a legal tender still has a long way to go. Recently, South Africa’s PayFast ended support for Bitcoin citing a number of issues.
“Unfortunately there are a number of limitations and design flaws unique to Bitcoin that make it an impractical substitute for cash, including high transaction fees and long confirmation times for buyers,” announced the firm. “We’ve tried various ways to mitigate these problems, but unfortunately, these issues are fundamental. The resultant poor user experience has led us to re-evaluate Bitcoin as a payment method on our platform and a decision has been taken to discontinue support for Bitcoin from midnight 20 July 2019.”
According to the firm, initially Bitcoin held promise of a global currency that would allow a faster, cheaper, and easier way to move money on the Internet. Bitcoin promised movement of funds for day-to-day transactions and was able to process Bitcoin transactions. However, as Bitcoin grew popular, it became harder for transactions to be confirmed within a 10 minute time limit and the majority of Bitcoin transactions on the PayFast platform ended up being unsuccessful.
Following this report by PayFast, Zolango shows that its not aware of the overall slow performance and computational power consumed to validate Bitcoin transactions, hence disqualifying it as a means of exchange but better-suited as an asset.
“It’s estimated that the Bitcoin network can only handle about 7 transactions per second. In comparison Visa performs at around 24,000 transactions per second and even newer cryptocurrencies fare significantly better than Bitcoin with Ripple processing approximately 1,500 transactions per second,” added PayFast.
Zolango is also unaware that only a few fraction of Kenyans know what Bitcoin is and millions have never heard of it let alone own a computer or smartphone. Though Kenya has been a launchpad of great platforms such as TagPesa, BitPesa etc bitcoins and cryptocurrencies are for a little elite who understand the power of holding the digital assets and have been ferocius traders. By claiming the platform will use Bitcoin as a payments option, MVK is looking for fame, speaking engagements and nothing happening actually on ground. BitPesa has had to quietly distance itself from Kenya to survive. Zolango might launch a beautiful ecommerce website and that’s what they will have as the best ever KPI achieved.