Trouble is brewing in Kenya, as mobile provider Safaricom is facing a dual lawsuit for cutting off services through alleged intimidation. Both Lipisha Consortium Ltd and Bitpesa Ltd Friday have been cut off from the Safaricom network for an unknown reason and both companies have taken the matter to court. As a result of this debacle, the Bitcoin trading volume in Kenya has doubled on LocalBitcoins.
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Mobile Provider Squabble Takes Drastic Turn
Whether or not the decision made by Safaricom is based upon the fact both of these companies are involved in the mobile payment sector, remains to be seen. However, both Bitpesa and Lipisha are active in this space and with services suspended since November 12th, they can’t actively offer their services to customers.
Right now, there are rumours surfacing as to how Safaricom – allegedly – threatened Lipisha to cease offering their mobile payment service immediately, or risk termination of their business altogether. Bitpesa has been facing similar threats, according to Daily Nation Kenya. Do keep in mind these reports have not been confirmed by any of the company representatives.
Safaricom is an integral part of the business offered by both Lipisha and Bitpesa, as they are responsible for holding a large sum of the money transacted in the mobile space. At the same time, this opens up Safaricom to additional lawsuits from customers willing to access their funds, which could indicate this story is far from over.
At this point, Bitpesa is on the brink of a financial collapse, since there is no alternative to offer their business through. Safaricom has a near monopoly in the Kenyan mobile market space and if companies cannot access that service, they are unable to reach their customers. At this time, it remains uncertain as to when – or even if – the services to Lipisha and Bitpesa will be restored at some point.
To make matters even worse, Safaricom has ordered Lipisha to stop working together with Bitpesa as well. While this matter is of great urgency, a local High Court Judge wants to take the time to properly evaluate this case. According to Daily Nation, there was no notice prior to the suspension of services to either company.
Bitcoin Trading Volume Picks Up
While the services of both Bitpesa and Lipisha remain inaccessible for the time being, Kenyans are looking for alternative financial options. Bitcoin seems to be the preferred choice, as trading volume for the popular digital currency has more than doubled over the past few days. Whether or not this is related to the outage of both mobile payment providers remains unknown though.
One thing’s for sure: Bitcoin provides a viable alternative for every possible scenario, even in countries where mobile payments reign supreme. Providing options is always a good thing and Bitcoin is the only global currency available to everyone in the world today.
Source: Daily Nation Kenya
Images courtesy of Safaricom, Shutterstock