The Afrikaner community of Orania, a rural town in South Africa’s Northern Cape province established in 1991, is set to launch its own digital currency, according to CNN. The town, of roughly 1,400 people, is somewhat controversial as it is a whites-only community that has been created on private land near the end of the Apartheid.
Despite residents being mostly white farmers and traders, reports suggest no racial discrimination happens in Orania, but that it’s “foundational imperative to preserve Afrikaner culture effectively prohibits racial diversity.” The town is protected by South Africa’s constitution and in a bid to be self-sufficiency has created its own fiat currency, the ora.
The ora is printed by Orania’s own chamber of commerce, and is distributed through its central bank. It is, however, not technically a currency, but serves as a voucher or token pegged to the South African rand, and it expires after three years. It was introduced in 2004, and grants users discounts when used.
Now, to further the town’s independence, Orania’s plan is to create a virtual version of its currency, the “e-ora”. Users will be able to purchase e-ora from the central bank through an app, and then use them to trade locally via their smartphones. This digital version of the ora won’t have an expiration date.
The goal, aside from supporting Orania’s self-sufficiency, is to allow for more efficient transactions, and to cut the costs of printing paper currency. Moreover, the fees that apply to various credit card transactions can be avoided when using the e-ora. Reports suggest the e-ora could be in circulation as early as mid-August, or at most within a year.
The Afrikaner community has partnered with economist Dawie Roodt, chief economist at the Efficient Group, in order to create the e-ora. The prize-winning economist, according to CNN, says that the opportunity to be a part of the experiment was too exciting to turn down, despite potential controversy, adding that he is “going out of his way to explain that his interest is purely academic”.
The economy is contracting and the state is highly inefficient. We have more private security guards than policemen in South Africa — you have to look after yourself because the state won’t do it.
Experts agree that the e-ora would benefit from adoption in digital currency exchanges. According to Rik Willard, managing director at digital currency consultancy firm Agentic Group, e-ora’s value could increase if exchanges started accepting it, plus it could fund similar operations in other communities throughout the world.
Nevertheless, given Orania’s mostly white Afrikaner population, some are worried about its security if it does go big. Journalist Corin Faife stated:
I’d be worried about hacking resistance and traceability. The nature of the project is likely to bring them under fire from anti-racist groups.
Faife, according to CNN, added that the e-ora could attract the attention of authorities if it’s seen as part of a white supremacist movement.
Note: Orania is considered a controversial town. CCN’s report on the story is meant to only state gathered facts and inform readers on the development of e-ora and its future challenges.
Featured image from Shutterstock.
Last modified (UTC): July 26, 2017 13:11