I do have an issue, though, with UNICEF dealing in bitcoins. Results for children are not generated on the blockchain, but in the real world. The nurse vaccinating children outside Kathmandu wants to be paid in rupees, not in bitcoins.
As of 21 November, the dollar value of a bitcoin is 28 per cent of what it was one year ago. A bitcoin donation or payment made 12 months ago to benefit 100,000 children will benefit only 28,000 children today.
Innovation funds, crypto-funds,
venture funds, non-fungible tokens, innovation labs: what an exciting, fanciful and promising new world. Real time transactions, transparency, accountability, children at the centre of impact,
opportunity and choice. No catchphrase is left out when it comes to justifying UNICEF investments in blockchain, drones, artificial intelligence, machine learning, data science, and extended reality.
- In 2018, UNICEF invested 99,000 USD into Bangladesh based W3 Engineers, to develop what was later coded Telemesh. The system would allow refugee and migrant communities to connect with each other without the use of sim cards and internet connection, "paving the way for connecting another 3.9 billion" unconnected people. W3 Engineers graduated, after having connected 53 and 86 people in two test sites. This was before 2020, and Telemesh as well as W3 engineers seem to have gone offline since.
- Tunisia-based Utopixar received 99,000 USD from the UNICEF Innovation Fund. The Utopixar website primarily displays lore ipsum. Utopixar graduated in 2020, under the name Coinsence, which set out to “develop a social collaboration platform, enabling communities working on social impact causes to create their own currencies to mobilize resources and generate impact”. I did not succeed in identifying any impact on Coinsence’s website. On LinkedIn, Coinsence’s chief business officer refers to himself as blockchain evangelist, startup enthusiast and impact driven slasher. He announced that Coinsence is piloting innovative ways to engage the diaspora in impact projects. Coinsence’s business address is El Space in Tunis, which is a coworking site with four projects to its name, none of which include Coinsence.
- Iran-based Treejer is a blockchain-based platform aiming to “reshape forest finance….. with the help of local communities, who will receive support for their impactful contributions”. Treejer got 100,000 USD from the Innovation Fund.
With Treejer, individual and corporate donors can choose from a variety of trees, to create virtual forests. Upon graduation, Treejer stated “…we also learned [that] … a local shepherd changed his sheep herding route… so the sheep don’t feed on the saplings planted by his community.”
While many trees were funded, usually at 10 Dollar a piece, only a small number of trees have been certified by Treejer as planted, all in or near the town of Bezmir Abad in western Iran, in the first half of 2022. The certificates include the trees’ coordinates, some of which seem to have been planted the in the middle of an asphalt road, in the corner of a soccer pitch and under the tin roof of the local bakery. The up-to-date Google Earth satellite image shows no trace of planting activity, nor any hint why the rather random distribution of new saplings over an already lightly wooded area would make any sense. Before they went silent on all their social media channels, Treejer reported to have reached 19 milestones in improving the user experience for donors. The Chief Financial Officer of the Iran-based Treejer is the Founder and CEO of the Portugal-based ‘Get Boarded’ outfit, offering his clients to prep up their resume.
- UNICEF transferred 1.2734 BitCoins on 21 April 2022, at that time valued as just under 48,000 USD to the EdTech outfit AfriLearn in Nigeria. The links from the UNICEF website lead into the void. The website of MyAfriLearn has the look of a typical phishing site. The advertised Afrilearn app for smartphones does not exist in the app stores.
According to the UNICEF annual report of the venture fund (Investor Update), the start-ups have successfully graduated. The report promises but does not deliver a “deep dive into how solutions are accelerating results in UNICEF programme countries”. Instead, the innovation fund website repeats the same mantra: The start-up has “come a long way – from numerous product iterations to deep diving into understanding their ecosystem better, strengthening their business model, and gearing up to take their solution to market. They’re now ready to collaborate at a larger scale – as they find new pathways to work with partners, investors, and the open source community” [e.g. 1, 2].
Let me be clear on this: Trying to innovate carries the risk of failure. I wish the best to any serious start-up. We may try ten approaches and only one will work. But to learn a lesson, we need to acknowledge failure. Glossing over the true story doesn’t help anyone – not the investor, the start-up, UNICEF, nor any vulnerable children.
An incessantly repeated dogma of blockchain aficionados is the promise of ‘financial inclusion for underbanked and unbanked’ populations. Such systems, such as M-Pesa in Kenya, have been in existence for more than 15 years. M-Pesa has allowed anyone - including those with very little money – to make or receive payments – without a bank account or smartphone or blockchain. As the Guardian observed: paying for a taxi ride using your mobile phone is easier in Nairobi than it is in New York. Wider use of the app in other countries is not a question of technology, but of government regulations. Now, UNICEF paid more than 60,000 USD to Kotani Pay to develop an app that allows cryptocurrency to be sent through M-Pesa. And I was wondering: What do the poor and unbanked people know about cryptocurrency? And if the refugees have no need for bitcoins, who wants to send bitcoins to Africa? Who is benefitting here?
It’s the Wild West out there, not only since the crash of the bitcoin, the Theranos fraud, or the recent implosion of the FTX exchange that destroyed 16 billion USD overnight. It is a fast-moving virtual world, operating in the cyberspace, unhinged from reality.
Never-ending, nauseatingly repetitive and hollow techno-babble is common in the so-called start-up-ecosystem, with its abundance of outdated blogs, dead ends, broken hyperlinks, and circular referrals. The start-up ecosystem is primarily about itself and its own real or fantasized business success, with a vague promise of some nebulous “social impact”. It is easy to lose your bearings in the hype. As of 21 November 2022, the UNICEF Venture Fund still seeks application until 28 February 2019, and the UNICEF crypto-fund invites applications with a deadline of 31 January 2021. There is also one that expired on 21 August 2021. Everyone seems busy with the blockchain; no time for web maintenance. But, hey, there is also one that calls for applications by 9 January 2023. You can apply, as long as you are willing to accept crypto.
The gaze of the UNICEF innovation hubs seems firmly turned towards potential donors and the money that could be metabolized. It may be nice to look at some cool piece of technology, and then to find a problem which it could solve. But the UNICEF mission is to provide solutions for the most vulnerable children, not to finance yuppies and techno-geeks having a Starbucks Moment in Helsinki, or to immerse itself into its own virtual reality.
There is no blockchain or piece of computer code that will end gender discrimination, violence against children or marginalization. Exclusion is no accident. No tech-tricks will absolve government leaders from making necessary investments for children. UNICEF has experts in the field, who know the real-world problems. If they would not be misused as administrators, if they would not remain glued to their budget screens and fancy reporting tables, and would not waste their time in pointless coordination meetings, they could help building the politicial momentum for applying proven and tested real-world solutions, also in innovative ways. And the innovation offices may leave their nordic comfort zone, get mud on their boots and smell the coffee where it grows.
More Insights from Outside the Bubble
Detlef can be contacted via detlefpalm55@gmail.com
Bravo for stating the obvious. This article should be mandatory reading for existing senior UNICEF staff from ExDir down to P4/L4.
ReplyDeleteMight I respectfully suggest that UNICEF should not give ‘cyber’-explanations for failure to provide essentials for children and women ? There must be sustainable funding for – for instance – the cold chain to ensure that kids don’t die unnecessarily from preventable diseases. Crypto currency does NOT ensure sustainability. You could use the same logic for the provision of essential nutrition, essential pharmaceuticals, essential education and essential safe water, etc.
I wonder if UNICEF has ever considered making it mandatory for the audit section to evaluate donor reports ? If this were done as a matter of course, I am sure this ‘cyber’ reporting would never have been allowed to proliferate. Such an unnecessary waste of children’s lives and squandering of resources.
Thanks Detlef for this excellent analysis of the dangers facing UNICEF or any humanitarian aid or development agency of dabbling in the world of crypto, NFTs, and other unregulated banking and investment systems. I must add my concern that what starts with good intentions can too easily end up leaving aid agencies as 'shills' for the global companies wanting to sell their investment schemes to countries and populations they otherwise find difficult to 'open for business'. UNICEF's brand and good name is valuable and must be protected. Let us not end up being the sheep's clothing.
ReplyDeleteBeware, beware, be skeptical
Of their smiles, their smiles of plated gold
Deceit so natural
But a wolf in sheep's clothing is more than a warning
Good points Detlef. To me it is an old process that ails UNICEF, that of leadership transition. When leaders change many initiatives started by predecessors are left unattended and left to die their own death. What I believe needs to happen is that if you don't agree with the initiatives for whatever reason, they need to be brought to a close and not left unattended and orphaned. One needs to remember that people don't see who is the new head of the division, they just see a shoddy UNICEF whose initiatives just didn't go anywhere and nothing was done to bring them to a close.
ReplyDeleteDetlef also I checked with a few people involved. The contribution was in cryptos and paid for in cryptos as per donors conditionality. But they still should have been brought to a close even with a simple statement that they did not have desired impact it success and hence were brought to a close.
ReplyDelete@Sharad. The innovation office is not dead or dormant. It has opened three new offices in Stockholm and Helsinki, and is planning another one in Copenhagen. New applications for the venture fund are invited.
ReplyDeleteContrary to Detlef I have a deep gutteral aversion to most things digital. After retirement I went ten years without a computer, then five more years before I got an IPad and until today I still do not have a smart phone! This puts me in the category of XUNICEF "dinosaurs", but I still manage to do a lot of things using the Laptop mainly as a typewriter and info-searcher. Thus, I join my colleagues in worrying about UNICEF's multiple ventures into the crypto world and the difficulties it might face. While innovation is commendable it should not affect the bread and butter issues that children increasingly face these days in many parts of the world and where UNICEF's tried and true actions have over seven decades provided the necessary assistance to alleviate the problems. It appears that many such actions are the result of donor "support" and UNICEF staff seem to have difficulty in refusing funds. The corollary to this is that all such monies in fact result in donors reducing "regular" contributions while giving to all kinds of innovative ventures, most of which it appears have not much succeeded.
ReplyDeleteGreat points! UNICEF’s interpretation of ‘innovation’ is still too narrow - and limiting.
ReplyDeleteI found this frightening. How about an article on some successes from the innovation fund? Are there some, maybe not crypto related?
ReplyDelete(note: My comments will always come up as "Anonymous" as one of my digital hang-up is getting tangled up in anything Google). So "anonymous" may often be "Steve".
ReplyDeleteCongratuations to Detlif on your incredible, well researched, and beautifully written update on UNICEF's Crypto joudrney. Just to check after a few months, I find the "innovation" gang still have their pages on the main UNICEF website, filled with all their crypto/blockchain jargon.
As a meager supplement to Detlif's great presenation, I might not that a number of development/charities seem also to ahve been bitten by the crypto bug. So UNICEF appears one one website of mysteriour origin as one of "7 Amazing Charities That Accept Cryptocurrency." Donations https://www.makeuseof.com/charities-accept-crypto-donation/#:~:text=7%20Amazing%20Charities%20That%20Accept%20Cryptocurrency%20Donations%201,Project%20...%207%207.%20Save%20the%20Children%20
Some might find Paul Krugman's column the Dec. 3 NY Times of interest -- "Blockchains, what goo do they do?" Here a a couple of excerps I consider particularly relevant:
" We are, many people say, going through a "crypto winter". But that may understate the case. This is looking more like Fimbulwinter, the endless winter that in Norse mythology, precedes the end of the world -- in this case the cyprtoworld, not jut cryptocurrencies but the whole idea of organizing economic life around the famous "blockchain."
""A recent blog by Tim Bray, who used to work for Amazon Web Services, tells us why Amazon chose not to implement a blockchain of its own: It ccouldn't get a straight answer to the question, "What useful thing does it do?"
(And on why some many jumped on the crypto/blockchain bandwagon)
"The romance of high tech also played a role, with the very incomprehensibility of crypto discourse acting, for a while, as a selling point. And then, as prices soared, fear of missing out -- plus large outlays on marketing and political influence-buying -- brought many others into the bubble."
(to be continued in case there is a limit size of single "comment" Steve Umemoto
Again from "Anonymous" -- The concluson of Krugman's piece on the blockchain:
ReplyDelete" It's an amazing story, and also a tragedy. It's not just the small investors who have lost much if not all of their life savings. The crypto bubble has had huge costs to society as a whole. Bitcoin miniing alone uses as much energy as many countries: I've been trying to estimate the value of the resources consumed in producing fundamentally worthless tokens, and it's probably in the tens of billions of dollars, not counting the environmental damage.
Add in the costs associated with other tokens and the resources burned up in abortive efforts to apply a blockchain approach to everything, and we're probably talking about waste on an epic scale.
No doubt I'll hear from many people still insisting that I don't get it. But it really looks as if there never was an it to get."
Final comment from me. If there are a number of us that share the perspective so well presented by Detlef, what about as a group, sharing that perspective with the UNICEF ED?
Steve