Yellow Card's CEO is preparing the crypto exchange for pan-African expansion

For much of the world, the name Yellow Card may conjure up soccer penalties. In much of the tropics, and especially sub-Saharan Africa, a yellow card is proof of vaccination against yellow fever — which can be as critical to going between countries as a passport.

For Yellow Card, a crypto exchange that launched in Nigeria in 2019, crossing borders is central to the mission. Since it launched, the team has expanded to 118 people based in 16 countries. Now operational in 12 of sub-Saharan Africa’s biggest economies, Yellow Card is putting crypto’s promise of cross-border payments to the test. 

At the end of September, Yellow Card raised $15 million in a Series A funding round that saw participation from Square and Coinbase Ventures. It was the largest funding round ever for an African exchange. With the new funding in hand and an expansive team, the firm plans to test the role that crypto can play in connecting siloed economies and unbanked people of the region. 

The exchange already does about $50 million in volume monthly and has roughly 300,000 users. Now it has ambitions to expand beyond a few core markets.

A streamlined experience

In a recent interview with The Block, Yellow Card’s CEO Chris Maurice recalled that around the time of starting the firm he asked someone about the best way of sending money from Lagos to Accra, the capitals of Nigeria and Ghana. The two are separated by less than 300 miles, but those miles include both Benin and Togo.

The response? “Get a car, drive the eight hours across country borders.”

The patchwork of different currencies and payment systems makes sending money across African borders challenging. Aiming to streamline the process for regular people, Yellow Card is a compact exchange. It offers neither exotic derivatives trading nor the widest range of tokens or token pairs. Indeed, it supports just Bitcoin, Ether and Tether.

What sets Yellow Card apart, Maurice says, is its smooth user experience and banking relationships that ensure top-notch fiat-to-crypto liquidity across all of its supported countries, from Nigeria to Kenya to South Africa. 

“Fiat’s really the big kicker” Maurice told The Block. “At the end of the day, that’s more the secret sauce than the actual facilitation of crypto.”

Tacos and bitcoin

Speaking of secret sauce, Yellow Card’s origins stretch back to Maurice’s college days — and a Taco Bell in Alabama.

Maurice, a native of New Orleans, got his start in crypto running what were effectively cash over-the-counter (OTC) bitcoin desks while a student at Auburn University.

After initially posting ads online and getting a local response, he says, “We did the only thing for a reasonable college student in our position to do, which is every Wednesday, at about 7 pm, we would set up shop at the Taco Bell in Auburn, Alabama. You could come in and put a hundred dollars on the counter and we would scan your QR code and give you your bitcoin.”

That guerilla approach to Bitcoin financing in some ways seems like a critical background for someone approaching African payments.

Despite the existence of an African Union, a shared currency like the Euro remains a distant prospect. Local jurisdictions host competing currencies and financial institutions with wildly differing access to common international intermediaries like the U.S. dollar. 

Endemic logistical issues are durable challenges, but they have made Africa the subject of a great deal of interest in electronic payments developments that could leapfrog more traditional financial institutions. Kenya’s popular M-pesa, a branchless banking system that lets people deposit, withdraw and transfer cash via their mobile phones, is the most famous example.

Africa’s patchwork of payment systems has long looked like a clear use case for crypto. While crypto penetration in, say, Nigeria is high, Yellow Card’s aim is crossing borders — whether national or between fiat and crypto. A year ago, the firm’s roster included just three countries. 

According to Maurice, the goal is to “make sure that everybody, no matter what country you're born into, matter what currency you're born into, is able to access crypto.”