Uganda Internet Blackout Clears All Bitcoin P2P Trading Activity

In the US, social media can censor the president. In Uganda, the president can censor the Internet.

Tips

• The Ugandan government basically shut down the internet before Thursday's presidential elections.
• Critics say the move was to stifle the flow of information.
• It is also stifling the flow of Bitcoin.
• In the run-up to Thursday's elections, Ugandan President Yoweri Museveni, who has been in power since a coup in 1986, appeared to be doing everything he could to win a sixth term.

The police had arrested and harassed his main opponent, pop star-turned-politician Bobi Wine; they had used the COVID protocols as a pretext to shut down opposition events; and then government agencies shut down access to social media apps like Facebook, Twitter, and WhatsApp.

But as Ugandans circumvented social media restrictions via virtual private networks (VPNs), on January 13, the Uganda Communications Commission disconnected the entire Internet indefinitely, ordering Internet service providers to suspend the operation of international portals.

Expat Kyle Spencer, head of the Uganda Internet Exchange Point, a non-profit organization aimed at improving the country's Internet connectivity, wrote that Uganda was "cut off from the world." National Internet traffic dropped by 95% in one day . "Only a few networks still have a pulse," he wrote. "Most are off the air."

Said an anonymous source on January 12, when only social media sites had been attacked: "In Uganda, the closure is simply to prevent the flow of information from the public at a time when we need full transparency and open information. ".

As a side effect, according to analytical site UsefulTulips, no Bitcoin trading activity has been reported on LocalBitcoins or Paxful within Uganda since January 14. A Decrypt visit to Paxful's Ugandan Shillings (UGX) site found offers for sale from Ghanaians, Nigerians, and Kenyans, but not Ugandans. The UGX traders on LocalBitcoins came from neighboring countries like Rwanda, Tanzania, and the Democratic Republic of the Congo.

Of course, the Ugandan market is small: P2P markets register between $ 5,000 and $ 15,000 of trade per day. "It is so small, in fact, that Binance shut down its local site, citing low trading volumes," the anonymous source noted. That was in November 2020.

However, the lack of activity is concerning, as Bitcoin has some weak points in countries with authoritarian-leaning governments and monopolies.

MTN Uganda, a telecommunications company that has been forced to accept the blackout, controls 60% of the country's mobile phone market. It plays a fundamental role in Internet access, via smartphones and USB devices. And he runs Mobile Money, a mobile-based payment system that many use to send remittances, pay for school fees, and, yes, buy censorship-resistant Bitcoin.

Ugandans, however, are used to being isolated and adept at creating alternative solutions. In 2018, the government began taxing visits to social media applications on mobile phones as a way to avoid "gossip." The social media blocking earlier this week was the next logical step.

That meant that the opposition groups were ready for the dirty tricks. Hilary Innocent Taylor Seguya, a Bobi Wine supporter who drew international attention by suing President Museveni for blocking him on Twitter , told Decrypt :

"We had encouraged many to install VPNs ... [Museveni] does not want Ugandans who oppose their bad government to report on the irregularities and illegalities of this Thursday's elections, but we are lucky to have the VPN alternative today ".

However, the shutdown of the internet makes that moot. And while blockchains can continue to function even if Internet access ramps go down - using everything from satellites to mesh networks - why do some governments decide to make their citizens work so hard to share information and money?

Posted Using LeoFinance ^Beta