Kenya’s underbanked youth are turning to bitcoin, but experts sound alarm as crypto takes root in Africa’s largest urban slum.

Nairobi’s Kibera slum, a patchwork of makeshift homes and colorful market stalls, is no stranger to innovation born of necessity. Now, a new kind of currency is changing hands—and lives—on its mud-caked streets. Bitcoin, the world’s most famous cryptocurrency, is quietly fueling a financial shift among Kibera’s poorest. But is it a lifeline or a lurking threat?

Young entrepreneurs and local vendors in Soweto West, inside Kibera, are embracing bitcoin thanks to a grassroots drive by AfriBit Africa. The nonprofit arm of the Kenyan fintech start-up has funneled over $10,000 worth of bitcoin into the neighborhood since 2022, primarily through crypto grants to youth garbage collection groups.

With no formal bank accounts and few options for saving, these youths use bitcoin as both wage and wallet. Every Sunday, after hauling trash from alleyways, dozens of collectors are paid a few dollars’ worth of digital coins. The system, says AfriBit Africa’s team, offers financial access to those who are cut off from Kenya’s banking system.

Meanwhile, visible changes ripple through small businesses. Dotea Anyim, a vegetable vendor, sees 10% of her customers pay using bitcoin for tomatoes and onions. She appreciates bitcoin’s speed and the absence of pesky transaction fees—problems that often plague Kenya’s dominant M-PESA mobile network.

The appeal goes beyond convenience. Residents like Damiano Magak, a 23-year-old garbage collector and food seller, see bitcoin as a way to leapfrog barriers built by bureaucracy and poverty. No papers. No banks. Just a smartphone and a crypto wallet.

There’s also optimism. Many in Soweto West believe bitcoin prices will soar, multiplying their meager savings into a real nest egg. For some, up to 80% of their wealth now rides on the volatile cryptocurrency.

But this bitcoin boom is not without danger. Experts warn that the stakes are sky-high—especially for financially vulnerable communities like Kibera. Ali Hussein Kassim, chair of Kenya’s FinTech Alliance, cautions that such heavy exposure makes people painfully sensitive to price swings. A crypto crash could devastate families’ hard-won savings overnight.

The lack of education, regulation, and consumer protection in the cryptosphere only heightens the risk. While companies like Coinbase and Binance offer global crypto services, their platforms aren’t always tailored for unbanked or low-literacy populations.

Curious about diving in—or warning friends and family? Experts urge new users to:

For now, bitcoin is both hope and hazard in Kibera. It empowers residents overlooked by banks, but exposes them to sharp financial shocks. Kenya’s experiment in micro-scale “crypto inclusion” will be watched by global markets and policymakers alike as 2025 unfolds. Will digital coins replace cash—and deliver prosperity to the world’s poorest?