A warm FTX welcome to a promising new customer base, tweeted Sam Bankman-Fried on November 3rd, just days before the collapse of the cryptocurrency empire. “Hello, West Africa!” he wrote, sharing the news that FTX has accepted a new currency, the West African franc, and that anyone looking for somewhere to store their money and do some cryptocurrency trading in the region can now open an account with their company. Sub-Saharan Africa accounts for just 2 percent of global cryptocurrency trade, but adoption has surged in recent years, and cryptocurrency enthusiasts have long seen the continent as a testing ground for some of cryptocurrency’s practical applications, such as facilitating money transfers. Many FTX users in Africa did not trade bitcoin or ethereum and instead simply used the platform to convert local currencies into the less volatile US dollars, which FTX advertised to its demise by collecting 8 percent annual interest. The deal seemed almost too good to be true, and one Twitter user passing by BeerLife – “Beer, Blockchain and Bull Dog lover” – responded to SBF’s congratulation on the day with a warning: “Beware of West Africa like everyone else The westerners you are dealing with only want to steal your money.”
SBF’s vision was always global, and FTX’s African marketing operation was a localized version of the company’s US playbook. Instead of Tom Brady and Larry David, several popular Nollywood actresses and local influencers appeared in the commercial filmed by FTX Africa; Instead of giving away $500 in cryptocurrency to fans at a Miami Heat game at the venue formerly known as FTX Arena, FTX Africa ran a promotion giving away $5 to Ghanaian users who want to open a new account.
Much of FTX Africa’s marketing energy is directed through dozens of campus ambassadors who have been called upon to recruit others to use the exchange. Most of the ambassadors were university students working for free, hoping to earn a referral commission or one day get a job based on how many people they recruited. (Parts of the crypto world have always looked like multi-level marketing, and virtually every other major crypto uses similar networks in Africa—one was already offering gigs to FTX African ambassadors eager to find work.) “You have to have it to get paid. hosted a successful event,” Godson Joseph, FTX Campus Ambassador in Nigeria, told me. To be awarded the privilege of hosting the event, regular presence on FTX Africa’s social media networks, getting people to deposit money into their FTX accounts, and FTX Africa’s marketing team it takes convincing to get a few hundred people on the pitch. Lunch was usually served. Ambassadors can get a commission for everyone who signs up for an account, and a decent turnout can earn an ambassador $200. Joseph, who told me he’s been with the company since February, plans to host his first event in December and he expected to be paid eventually.
The rapid collapse of FTX destroyed the people who trusted the local promoters of FTX. Several Nigerians I spoke to told me that they or their friends had lost their entire life savings: six figures in one case, $10,500 in another, $100 someone had managed to scrape together. Nigerian cryptocurrency company Nestcoin was forced to lay off at least 30 people after losing millions in its FTX account, and many expected the contagion to spread to other African crypto companies. “I have to start by saying I’m in hiding right now,” Harrison Obiefule, a Nigerian who runs FTX Africa’s marketing efforts, said on Twitter the day FTX filed for bankruptcy. “I get threats and calls non-stop from celebrities, family, friends and strangers. The consequences have just begun.” He posted the laptop for sale on Twitter and posted a peace sign emoji on his account.
I also spoke with Emmanuel Godswill, a 34-year-old Nigerian who is a founding member of an unusual organization called FTT DAO, “a community dedicated to FTT, a cryptocurrency exchange native to FTX”. (The DAO, or decentralized autonomous organization, is a kind of cryptographically enabled club.) Members proudly called themselves BFFs, short for “Bankman-Fried Fans.” Godswill and other BFFs, many in Africa, have held events to promote the benefits of blockchain technology and the good they can do together—donate books to schools, help flood victims in Nigeria—if they all sign up for FTX and money. At an event where Godswill stood on stage in front of a 10-foot-tall banner featuring SBF’s face, she said she hopes everyone can go home afterward and tell their loved ones that participating was “a turning point for me.” life.”
Godswill told me he lost some money during the FTX collapse—”Not a lot, but it was a lot for me”—though what bothered him more was the time and energy he spent supporting SBF’s vision. Before starting work with FTX and several other cryptocurrency companies, Godswill said he supported his family on $20 a month. “In the crypto space, if you use your skills correctly, you can make $10,000 in a month or two,” he said, insisting that it is possible to trade for such sums. But how to start? That’s where the FTT DAO comes in, Godswill explained. “This organization brings that education to your door for free,” he said. “It’s like salvation has come.” When we spoke, she was at her home in Uyo and the youngest of her three children was crying in the background. He was still trying to figure out what had happened. “It was like we were taking that guy on our heads and going out into the streets — it was like evangelism,” Godswill said. “We did it with passion and dedication. We had hope. And crushed him.”