ORANIA, South Africa – The white Afrikaner community that famously sprang up in a sparsely populated corner of South Africa at the end of apartheid is now testing a digital currency that could reinforce its sense of independence.
Some residents of the town of Orania, population 1,600, are trying out the digital version of their own self-declared Ora currency. While pegged to the South African rand, the currency is a symbol of cultural preservation for the all-white community that says it feels under siege in the new South Africa after the 1994 end of white minority rule — while many in the country view it with wariness as a non-inclusive enclave that refuses to break with the past.
"I'm very proud that Orania is at the forefront of development with the E-Ora," said Monja Strydom, one resident who now pays for her shopping using her mobile phone. "Although we are still learning; this has been a beta test phase."
While the E-Ora is not a crypto-currency like Bitcoin, it gives Orania residents a potential escape from South Africa's rand if that currency comes "under great pressure or hyper-inflation," said the president of the Orania Movement, Carel Boshoff.
"If the rand became so weak that one were to decide to walk away from it, one could perhaps couple (the E-Ora) to something else, such as a basket of currencies out there. Or something inside Orania. Something comparable that has value," said the chairman of the Orania Chamber of Commerce, Daniel Dames.
For the officials, ultimately tying the local Ora to a hard currency is a more attractive idea than aiming for a full-fledged crypto-currency without any central control. Boshoff sees crypto-currencies as being fuelled by speculation.
The new currency experiment, which began in January, emphasizes Orania's drive to stand apart.
The community was established in 1991 just as the apartheid system was being dismantled, and Orania is legal in the eyes of the South African constitution. Article 235 allows for the right to self-determination of any community sharing a common cultural and language heritage.
More than a quarter-century after the end of apartheid, South Africa is a mixed-race nation with a black majority and black president. But in Orania, white Afrikaners are the only people to be found.
The community in remote Northern Cape province is located on private land with its own municipal services and two schools. The local economy is based on agriculture and tourism.
"A marked amount" of Afrikaners arrive at Orania with nothing and are given a place to sleep and work, Boshoff said. Others arrive with professional qualifications and slot into the community's middle class.
The ethos in Orania is self-employment and the community's internal currency "underlines the thought of self-reliance . that will stimulate an internal economy," Boshoff said.
When Strydom finishes her work shift she strolls over to the chamber of commerce, where she converts her existing Ora into the new E-Ora.
She said she likes not having to carry cash. "I can be anywhere and do a transaction, so that makes it very easy, actually. Also, the transaction costs are very low."
The transaction costs during the beta phase have been .5 percent, which compares favorably with bank fees in South Africa and abroad.
Dawie Roodt is an economist who helped Orania to develop the E-Ora and a self-proclaimed free-marketeer. Lower transaction costs equal more transactions and therefore a stronger economy, he said.
The South African Reserve Bank is still developing a position paper on crypto-currencies. Meanwhile, the bank's deputy governor Francois Groepe said the Ora cannot be called a currency but rather a token.
"The only legal tender in South Africa is the South African rand," Groepe said.
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