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- Empowa, a Cardano-powered DeFi platform, aims to address Africa’s housing crisis.
- Coinbase highlights the potential of blockchain technology to transform the situation.
Tackling Africa’s Housing Affordability Crisis
Coinbase, a prominent cryptocurrency exchange, has drawn attention to the transformative power of blockchain technology in addressing the exorbitant mortgage rates crippling the housing market in Africa. Specifically, Coinbase has recognized the efforts of Empowa, a decentralized finance (DeFi) platform powered by Cardano (ADA), that seeks to tackle the housing affordability crisis on the continent.
3/ Enter: @empowa_io, a company making homes more accessible to Mozambicans by tapping into NFTs and blockchain technology to update an antiquated loan system. They work in partnership with @CasaReal13 to construct cyclone-resistant homes in central locations.
— Coinbase 🛡️ (@coinbase) May 12, 2023
Empowa has set an ambitious goal of enabling one million African families to become owners of climate-smart homes by 2030. The company is determined to disrupt the current real estate market, characterized by prohibitively high mortgage rates. In Zimbabwe, for instance, the rate stands at a staggering 45%, according to Empowa. Such financial barriers have perpetuated a cycle of unaffordable housing across Africa.
The Severity of the Issue
In their white paper, the Empowa team emphasizes the severity of the problem, citing low levels of investment, high interest rates, and short finance terms as contributing factors to the exorbitant cost of capital. The Centre for Affordable Housing (CAHF) Annual Report of 2020 reveals mortgage rates of 32% in Zambia and at least 25% in Guinea, Nigeria, and Zimbabwe.
Empowa’s Innovative Approach
Empowa, in collaboration with Casa Real, is leveraging non-fungible tokens (NFTs) and blockchain technology to revamp the outdated loan system and make homes more accessible to Mozambicans. Through decentralized funding models and NFT technology, individuals can purchase homes without relying on traditional mortgages. These cyclone-resistant homes, located in central areas, are priced starting at $10,000, making them affordable for low- and middle-income families.
Coinbase’s Objectives and Commitment
Coinbase’s decision to bring attention to this issue serves multiple purposes. Firstly, it raises awareness about the challenges faced by Africans in securing affordable housing. Secondly, as a leading cryptocurrency exchange, Coinbase showcases the potential of blockchain and cryptocurrency technologies to address real-world problems.
Thirdly, this move may indicate Coinbase’s interest in exploring market expansion opportunities in regions like Mozambique. Lastly, Coinbase’s commitment to corporate social responsibility is evident as it utilizes its influence to shed light on social issues and promote innovative solutions.
The collaboration between Empowa, Cardano, and Coinbase signifies a concerted effort to revolutionize Africa’s housing market through the application of blockchain technology, providing hope for millions of individuals striving for affordable and sustainable homeownership.