Lucky Uwakwe of Sabi Groups speaks on FTX crash and vulnerabilities of centralised exchanges 

Temitope Akintade
Lucky Uwakwe, Founder of Sabi Group

Lucky Uwakwe, founder of Sabi Groups is a certified blockchain specialist, a DeFi expert and a seasoned crypto trader. As a veteran in the industry, he is one of the pioneers that have stood the test of time in the African blockchain space.

In an interview with Technext, he shares bits and pieces of his experience in the crypto space and comments on the FTX crash. 

He recalls how he knew about crypto but wasn’t committed until 2014. According to Lucky Uwakwe, having blockchain discussions at that time, even among tech enthusiasts, was not a thing. 

When I read the concept of what Satoshi Nakamoto had, in terms of his plans for the world and the design of money, I felt this is the real thing. And ever since then, I never looked back.”

For his country, Nigeria, he was more interested in seeing how the technology could give people the financial freedom they need in terms of opportunities because the earlier one understands blockchain technology’s power, the better. 

Read also: A chat with Eric Osuorah about Sellitic’s mission to reward African creators

So I was more focused on how my continent doesn’t miss out on this. Sometimes in 2014 I became very committed to it but prior to that time I learnt about crypto but I wasn’t committed. I became a pioneer member of the first blockchain community in Africa known as Cryptography Development Initiative of Nigeria (CDIN) as early as 2015.”

Lucky Uwakwe on Sabi Exchange and vulnerabilities of centralised exchanges 

Lucky Uwakwe established Sabi Exchange, one of the earliest crypto exchanges in Africa. There were concerns about international exchanges treating Nigerians unfairly at that point. 

So I thought, what if we could run a crypto exchange built and domiciled in Nigeria? There’s an advantage to using a localized type of company (citing FTX users in the Bahamas). Setting up my own localised exchange was a game changer for me. I wanted something where people would be able to connect. 

Lucky Uwakwe

Our exchange got affected in the wake of the Chinese government crackdown. We got technical insurance from China to secure customer funds. Upon the crackdown in China, they could not offer that again. As it stands, we’re reworking our model to get the exchange arm of our business back. We are now deciding to get a new partner to provide us with that insurance. We’ve got that, and we’re working to come back. As a company, we have other things like the Sabi payments Solutions and other kinds of stuff which are currently operating outside the shores of Africa for payments-related services.”

Lucky Uwakwe
Lucky Uwakwe

Although centralised exchanges (CExs) typically run in the same manner, Lucky Uwakwe says Sabi Groups wants to give users an alternative solution in the form of decentralised finance (DeFi) where customers will be able to access DeFi features while using the centralised exchange.

I’m an advocate of decentralisation and I think it’s only fair looking at what’s happening in the industry.”

Since the devastating collapse of FTX last week, there are now questions surrounding the sustainability of CExs. There are also talks about how CExs do not operate according to the inherent principles of blockchain technology. 

Related post: FTX loses financial service license in South Africa 

According to Lucky Uwakwe, blockchain does not revolve around decentralisation alone. 

“Decentralised exchanges operate according to the principles of blockchain technology, but the principles of blockchain do not lie on decentralisation alone. It lies more on transparency, so we should be able to take note and monitor, follow and raise the alarm when we see red flags. Blockchain came with two things, how do we make this thing transparent and democratize it. Government alone shouldn’t have a say in money, but the people should also have a say.”

He, however, remarks that decentralised exchange is now a thing of necessity, considering how people are losing confidence in CExs. Lucky Uwakwe expects the FTX issue to be resolved soon if there is a bailout. 

When someone buys them along with their liabilities and that person is able to pay with the hope that these customers would stay.”

Blockchain in Africa and the future 

Africa is projected to lead the next stage of the blockchain revolution, and Lucky Uwakwe echoes these sentiments.

Legacy system is not deep rooted compared to the western world and implementing  the technology would give us an advantage. I’m not even surprised that Nigerian, Ghanaian, South Africa central banks are now at the forefront of adoption. I think it’s in the best interest of Africa to adopt that regulatory path. Africa is the best place for blockchain regulation to be tried whether it’s coming by trial by errors or by deliberate trials.”

Going forward, Lucky Uwakwe wants to impact in a much more positive way doing charity and donations. He has a flair for investing in Gen Zs too. 

“I see them as being smart. I invest in Gen Z doing something innovative most times. The company now also focuses on blockchain consulting or a payment related solution. Diversifying from just being a crypto exchange to into payment.”

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