Author: Will Awang
The world is flat
Our world has transformed from isolated local economies to a tightly interconnected global system through the global links of the Internet, which is why Thomas L. Friedman said that "the world is flat". Although the Internet has made the flow of information free and global, the infrastructure supporting the flow of funds still relies mainly on the framework before the Internet era, and the flow of funds/value is still so difficult and expensive.
While some regional financial innovations can speed up the flow of funds, the financial tracks that support Africa have not been synchronized. The traditional financial system has failed to provide stability, accessibility and efficiency, leaving people at risk of inflation and financial uncertainty, with limited control over savings and difficulty accessing global markets. But just as the region skipped the desktop era and went directly to the mobile field, now the African continent is ready to move beyond the outdated banking infrastructure and actively embrace stablecoins.
We can no longer limit our vision to the trading use cases of stablecoins in the native crypto market, but should look at the real use cases of stablecoins in non-crypto native scenarios from a new perspective. Stablecoins have become an important part of the crypto narrative in Sub-Saharan Africa and a popular hedging tool against long-term inflation and currency depreciation.
“Stablecoins built on blockchain networks are one answer. Stablecoins are our first real opportunity to do to money what email did to communications: make it open, instant, and borderless. This is the Whatsapp moment for money/value, where a global network built on blockchain and stablecoins can benefit everyone.” — Chris Dixon, a16z
1. Africa’s stablecoin revolution is quiet
Africa has the highest mobile money penetration in the world and is deeply rooted in the hearts and minds of the people, proving the need for alternative financial solutions. As a result, stablecoins are a natural fit, providing a way to seamlessly access financial services with just a mobile phone. Stablecoins can build on this foundation, expand financial inclusion, and enable more efficient borderless transactions.
According to Chainalysis data, Africa is the fastest growing region for cryptocurrency adoption , with a year-on-year growth rate of 45% from 2022-2023 to 2023-2024, exceeding the 42.5% of other emerging markets such as Latin America. This rapid growth highlights the huge potential for stablecoin applications, especially in Africa where bank penetration remains among the lowest in the world.
“Stablecoins are already a reality for cross-border payments in Africa… the rest of the world is just catching up.” — Zekarias Amsalu, Co-Founder of Africa Fintech Summit
One of the main drivers for the adoption of stablecoins in Africa is the foreign exchange (FX) crisis facing many countries. About 70% of African countries face a shortage of foreign exchange, making it difficult for businesses to obtain the US dollars they need to operate. In countries such as Nigeria, where the local currency, the Naira (NGN), has depreciated significantly, stablecoins provide a much-needed alternative. "Banks don't have dollars, governments don't have dollars, and even if they do, they won't give it to you." - Chris Maurice, CEO & Co-founder of Yellow Card
Over the past three years, stablecoins have become an integral part of Africa’s financial system, providing a reliable way to store value, remit money across borders, and trade without relying on highly volatile and unstable local currencies. USD-backed stablecoins such as USDT and USDC are filling a gap in traditional finance, giving people in economies where USD is scarce access to a stable store of value.
From remittances and retail savings to B2B trade and cross-border payments, stablecoins are addressing issues such as dollar access, instant settlement, and FX inefficiencies on the African continent , which are particularly prominent in markets where traditional payment channels are insufficient.
Africa is the world's most dynamic growth market, with the fastest growing population, the youngest median age, and nine of the twenty fastest growing economies. With 400 million mobile payment users, Africa has already achieved a large scale of digital finance penetration. Stablecoins are the next leap forward, turning smartphones into globally connected dollar accounts. Looking ahead, in ten years, more people in Africa will have crypto wallets and use stablecoins for daily transactions instead of traditional bank accounts.
“ You don’t need to educate users, life will force them to use it. ” ——Sky, Co-founder of ROZO
2. Projects that drive future stablecoin adoption
Chuk from Paxos created an ecosystem map for us covering payment channels, use cases, and companies to show the depth of this revolution. While many market maps showcase the global stablecoin ecosystem, few focus on Africa’s role in shaping its financial future. So we created this map to showcase the builders and use cases that are redefining the continent’s financial infrastructure.
(Mobile Money to Global Money: Africa's Stablecoin Revolution, Chuk @ Paxos)
In the past three years of investing in the African market, we have seen an increasing number of companies building around stablecoins, each playing a key role in driving stablecoin adoption and innovation. Below is a list of some of the most noteworthy players, along with key growth and funding data that highlight the rapid expansion of the industry.
Yellow Card: One of Africa's leading crypto asset exchanges, with operations in 20 countries across the continent. Africa's largest and first licensed stablecoin on- and off-ramp platform. Yellow Card allows users to seamlessly convert fiat to crypto and vice versa. The platform's annual trading volume doubled to $3 billion in 2024 from $1.5 billion in 2023.
Conduit: Provides stablecoin payment services to import and export companies in Africa and Latin America. Annualized TPV will soar from US$5 billion in 2023 to US$10 billion in 2024.
Juicyway: A Lagos-based startup that uses stablecoins to facilitate cross-border payments. Since 2021, Juicyway has processed a total of $1.3 billion in payments.
Bridge: Bridge was founded in 2022 and was acquired by Stripe for $1.1 billion just two years later. Bridge enhances the global stablecoin payment infrastructure. It serves most African payment companies and facilitates stablecoin payments in Europe, the United States, and Asia.
Jia: A blockchain-based fintech company that provides loans to small and medium-sized enterprises in emerging markets. In 2024, Jia's cumulative loan issuance volume exceeded US$10 million, up from US$2 million in the previous year, with an internal rate of return (IRR) of 24% and a default rate of 0.14%.
Onboard: A global P2P trading protocol that allows anyone, anywhere to access on-chain finance. Nestcoin raised $1.9 million in its last round of funding to fuel the growth of its product.
KotaniPay: Provides stablecoin settlement solutions for businesses and users. KotaniPay is developing an API product that connects blockchain and local payment channels. In 2023, KotaniPay received $2 million in seed round financing.
Accrue: Building a USD stablecoin agent network and expanding cross-border payment infrastructure. It has received $1.58 million in seed round financing to expand its operations.
Convexity: Developed Nigeria's first regulated stablecoin, cNGN. The company has been working with the Central Bank of Nigeria since 2021 and received a provisional license from the Nigerian Securities and Exchange Commission (SEC) in 2024.
Honeycoin: A platform for cross-border remittances, bill payments, buying airtime, and online spending. GTV surged from $40 million in the previous quarter to $500 million in the fourth quarter of 2024.
Paycrest: Paycrest is a decentralized liquidity protocol that supports instant, low-cost payments backed by stablecoins. In addition, they have developed Zap, a DApp for seamless crypto-fiat payments, and won the Base 2024 Global Onchain Summer Buildathon. Today, Zap is ready for production in the form of Noblocks, the first interface for instant decentralized payments with any bank or mobile wallet, supported by a distributed network of liquidity nodes.
Haraka: A stablecoin-powered microfinance protocol for underserved entrepreneurs in emerging markets. Haraka leverages a reputation-based credit scoring system and has demonstrated early commercial validation through partnerships with Grameen Bank and Mercy Corps.
Many of these companies have experienced significant growth over the past two years and are at the forefront of stablecoin innovation in Africa.
For the global fintech community, the question is not whether stablecoins will go mainstream. The question is what we can learn from where stablecoins are already taking hold: Africa.
3. Stablecoins are solving everyday problems in Africa
“In Africa, it’s not a choice between stablecoins and other financial instruments. It’s stablecoins, or nothing.” — Samora Kariuki, Frontier Fintech
Across Africa, stablecoins are solving real problems. From preserving the value of assets to facilitating trade, stablecoin adoption is driven by necessity rather than transaction and speculation. Here are the most critical use cases based on real needs, and the companies that are building to support them.
3.1 Everyday tools: saving, spending and credit
Inflation, currency devaluation, and limited access to banking services make it difficult to establish financial security in many African countries. Stablecoins offer a more reliable path to becoming a dollar-denominated savings, transaction, and credit tool.
A. Asset Preservation
Stablecoins are gaining traction in regions where dollar banking services are difficult to access, inflation is high, and fiat payment networks are costly or unreliable. These conditions are reflected in the case of Africa, making stablecoins a critical tool for protecting savings and maintaining purchasing power, especially in economies where the local currency continues to depreciate.
Currency depreciation is one of the biggest financial challenges facing African markets. Take the Kenyan shilling, for example. Although Kenya’s GDP has tripled between 2008 and 2024, it has depreciated by 50% against the US dollar since 2021. The contradiction is obvious: economic growth is rising, but people’s confidence in the local currency is not. Similarly, in Nigeria, inflation and the depreciation of the naira have been key drivers of stablecoin adoption over the past 18 months. The naira fell to an all-time low in February 2024 and has struggled since then, which has further highlighted the need for stable alternatives.
(Stablecoins: Leapfrogging Africa's Financial System, Ayush Ghiya and Uchenna Edeoga)
As local currencies continue to depreciate, stablecoins are becoming the preferred hedge, providing a more reliable way to trade and store wealth. Unlike cash or gold, stablecoins provide a fully digital, widely available payment channel that does not rely on banks, payment networks or central banks. Not only do they hedge against currency fluctuations, they also offer higher yields than traditional savings accounts, making them an attractive option for Africans looking to preserve and increase their wealth. Traditional banks offer lower interest rates, while stablecoin savings platforms leverage decentralized finance (DeFi) and cryptocurrency lending models to create higher returns for users.
Currently, USD-based stablecoins are the preferred choice for users in emerging markets. USDT (based on TRON) has become the de facto digital dollar in much of Africa. Most users acquire stablecoins through centralized custodian applications such as Binance, prioritizing speed and liquidity over Western concerns about reserves or transparency.
For users facing foreign exchange rationing and 30% inflation, the most important thing is that it works. Stablecoins help users preserve the value of assets in marginal areas and save in stable currencies. According to the World Bank, as of 2021, only 49% of people in Africa have bank accounts, but 400 million people use mobile payments. Stablecoins can meet user needs in places where banks cannot cover.
Platforms like Fonbnk enable instant top-ups to USDT on basic phones, while Accrue provides a network of local community agents for cash deposits and withdrawals of stablecoins. Nigerian cryptocurrency platform Busha Earn allows users to save stablecoins with annual yields of up to 7.5%, which is much higher than the yields of most Nigerian banks. Sub-Saharan Africa leads the world in DeFi applications, likely due to the region's growing demand for convenient financial services. This shows that stablecoins are more than just an alternative, they are essential to financial stability in regions where traditional systems fail.
This makes stablecoin savings an attractive option—not only because of the higher interest rates, but also because users can earn a yield in addition to the value they gain by hedging against currency depreciation. These factors work together to make stablecoins a powerful tool for wealth preservation and growth.
“By converting everyday prepaid payments — mobile data, bank transfers and mobile money — into USDT, Fonbnk acts as a stablecoin settlement layer, providing the 400 million unbanked and underbanked Africans with a means to hedge against currency devaluation and opening up new avenues for savings and credit beyond traditional banks.” — Chris Duffus, Founder & CEO, Fonbnk
B. Expanding access to credit
Africa’s micro, small and medium-sized enterprises (MSMEs) face a $330 billion credit gap, and the lack of banking services has led to an underdeveloped micro and small enterprise credit system, shutting out millions of individuals and small businesses from banks. In these markets, small businesses are often overlooked by traditional financial institutions due to high collateral requirements, lengthy documentation processes, and lack of credit history. With limited access to affordable upfront capital, many MSMEs turn to informal lenders for financing, and the lack of affordable credit limits their ability to maintain daily operations and promote economic growth.
In the Web3 space, stablecoin-based lending protocols have shown great potential to solve this problem over the past three years. However, most such solutions still require excessively high collateralization ratios, requiring about 150% of crypto assets as collateral, which effectively excludes small and medium-sized enterprises in emerging markets. Although low-collateralized lending protocols such as Goldfinch have emerged, they mainly serve as alternative debt providers to fintech lenders rather than directly serving physical small businesses.
Recently, two companies, Jia (which uses decentralized finance to provide factoring, supply chain financing, and other loans) and Haraka (which uses an innovative social credit system), have actively worked to disrupt this space and seize market opportunities in Africa. These companies provide blockchain-based loans to small businesses and give responsible borrowers ownership rights, allowing them to build wealth and drive economic development in their communities.
Bringing this real-world economic activity on-chain is beneficial to both investors and borrowers. Investors can democratize access to real yields, while borrowers can gain access to blockchain liquidity and use ownership as a way to create long-term wealth for themselves and the community. The use of blockchain also reduces the high transaction costs common in private credit markets (which are often passed on to the end borrower) and enables borrowers to create an on-chain credit history, thereby building a reputation over time.
These tools give users more control over their money and unlock financial options that were previously out of reach.
3.2 Cross-border flows: trade, money management and remittances
As Stripe CEO Patrick Collison puts it, stablecoins are the “room-temperature superconductors of financial services.” They will enable businesses to pursue new opportunities that otherwise wouldn’t be burdened by existing payment rails or subject to the friction of traditional gatekeepers. This is particularly true in cross-border payments, where legacy systems are slow, costly, and dependent on multiple middlemen. High fees and lengthy delays complicate transactions — especially in Africa, where the average remittance rate is around 8% and financial infrastructure is often limited or absent.
Cross-border payments are fundamental to Africa’s daily economy, from importing goods and sending remittances to repatriating profits and paying freelancers. However, the payment channels that support these flows remain fragile: 3-5 day delays, 5-10% fees, and subject to foreign exchange rationing. Stablecoins change this, offering a way to solve these problems by enabling real-time, low-cost transfers without the need for large capital reserves or bank intermediaries.
(Stablecoins: Leapfrogging Africa's Financial System, Ayush Ghiya and Uchenna Edeoga)
In the above picture, a Ugandan user wants to transfer funds to a Nigerian user. If the remittance is based on the SWIFT network, since the two countries do not have a directly connected banking network, the user may have to go through an intermediary bank in the United States to transfer the money. However, once a stablecoin payment network is adopted, users do not need to make payments through multiple intermediaries. Instead, they can convert local currency into stablecoins and send them directly to Nigerian users, who then convert them into Nigerian naira and obtain funds locally.
This process eliminates the inefficiencies of SWIFT and net-based settlement models, as transfers are made directly through exchanges or blockchain wallets connected to currency acceptance deposit and withdrawal service providers. These service providers are integrated with local payment systems, enabling seamless conversion between stablecoins and local currencies.
Recently, Stripe acquired Bridge, a stablecoin API provider, for $1.1 billion, just two years after Bridge was founded in 2022, in an effort to enhance its global stablecoin payment network. Africa is a key market for Bridge, which provides stablecoin payment services to most African payment companies operating in Europe, the United States, and Asia. This highlights the growing market demand for stablecoin infrastructure and the speed at which major players in the field are expanding.
While Bridge has laid the foundation for the orchestration and issuance of stablecoins, there is still a lot of work to be done in this sub-field. Cross-border payments remain a huge opportunity, but there are also key issues that need to be addressed.
A. Trade and B2B Payments
China is Africa's largest trading partner, with Africa's imports from China reaching $176 billion in 2023, and a trade deficit of $66.6 billion. This creates a continuous demand for US dollar payments, and stablecoins meet this demand with high efficiency and high liquidity. Due to its deep liquidity and wide exchange support, USDT (based on TRON) has become the preferred channel for many commercial payments.
“Stablecoins are the new cornerstone of cross-border payments in Africa. Using Conduit, businesses can settle payments almost instantly, reduce working capital, maintain liquidity, and avoid currency volatility.” - Eric Wainaina, General Manager, Africa at Conduit
“Stablecoins have completely changed the situation for importers who could not get dollars through banks - now their business is booming.” - Suleiman Murunga, Director, MUDA
Intra-African trade payments: Intra-African trade accounts for only 15% of the continent’s total imports and exports, far lower than North America’s 54%, Asia’s 60%, and the European Union’s 70%. The main reason for this imbalance is the lack of direct currency exchange infrastructure - most transactions require converting local currencies into US dollars, pounds or euros, and then converting them into other African currencies. This inefficiency adds $5 billion in unnecessary costs to intra-African transactions each year. Solving this problem is critical to achieving smooth trade across the continent.
Repatriation: Some large multinational companies that sell goods and services in Africa can use stablecoins to repatriate funds to their home countries. With the help of stablecoin infrastructure, the settlement time of funds is less than 30 minutes, while traditional payment methods take 2-3 days.
B. Remittances and Global Payments
Just as stablecoins enable outbound payments, they can also bring money into the continent. This includes remittances, salary payments, and freelance income.
Remittances are one of the most common cross-border payment needs, but traditional methods of sending money make it costly. Global remittance flows will reach $883 billion in 2023, with fees disproportionately affecting low-income users. Today, it costs less than $0.01 to send $200 from the United States to Nigeria via stablecoins, while it costs $7.60 using traditional methods. Reducing these costs at scale remains a priority.
“Sub-Saharan Africa remains the most expensive region in the world for remittances, with an average remittance cost of 8.37% in 2024. However, many overseas Africans are unaware that they can now use stablecoins to send money home faster and at a lower cost.” - Xino Zee, Lead at Send Africa
Payments: For freelancers in the gig economy, cross-border micropayments remain costly and inefficient. In places like Kenya, some even choose to “rent” PayPal accounts because it’s too difficult to open their own – highlighting how barriers to access exacerbate the already high costs of small international payments. The emergence of stablecoins could significantly benefit these workers by streamlining the payment process. Additionally, businesses operating across borders could use stablecoins to efficiently manage cash flow and seamlessly pay employees, customers or suppliers around the world.
Global Aid: Currently, of every dollar donated to aid organizations around the world, only about 40 cents reaches the recipients, with the rest going to multiple middlemen. We clearly need a more efficient, cost-effective system to deliver global aid in a transparent and seamless manner.
A new group of companies is rebuilding Africa’s cross-border payments infrastructure around stablecoins. As exchanges, Yellow Card, Busha, VALR, and Luno provide liquidity for local currency acceptance for deposits and withdrawals. Conduit, Honeycoin, Shiga Digital, and Juicyway support commercial trade, collections, and payments, while Sling and Send facilitate consumer P2P payments.
These builders have quietly moved billions of dollars collectively. Many of these companies do not sell “stablecoins” directly, but rather sell cheaper remittances, working capital efficiencies, and currency stability.
IV. Opportunities for African builders
“In Africa, you kick a tree and down falls three fintechs using stablecoins… The strongest teams we’ve backed now have a single channel or industry liquidity — stablecoins are just hidden behind the scenes at fintechs.” — Brenton Naicker, Principal & Head of Growth (Africa) at CV VC
4.1 Four levers for creating value
The first wave of stablecoin growth focused on infrastructure: deposits and withdrawals, channel liquidity, and basic wallet functionality. This layer is quickly becoming crowded. The next stage is differentiation: who owns the users, who defines the standards, and who captures profits in real use cases. Here are four levers that will shape value creation across the continent:
A. Distribution: Winning Users
Control over the user interface and customer relationships determines where volume flows. The strongest companies are not leading with stablecoin infrastructure, but rather solving payment, lending, or money management problems, hiding stablecoins in the background.
B. Liquidity: Controlling Both Ends of the Channel
Local FX liquidity is uneven and difficult to replicate. Teams that can manage origin and destination flows can provide better pricing, internally net transactions, and reduce fees. Liquidity accumulates, creating a defensive moat.
C. Regulation: Shaping the rules before they are established
In highly competitive markets like Nigeria and Kenya, flawless execution is critical. But in less developed markets like Malawi or Cape Verde, first movers face less competition and can work with regulators to define the rules of the game. Early investors who invest in trust builders may win long-term policy consistency.
“Dollar liquidity is already on-chain in much of Africa through stablecoins. Policymakers should prioritize bringing local currencies on-chain at scale to accelerate economic sovereignty and trade.” — Wale Ayeni, Managing Partner of Helios Digital Ventures
D. Vertical fields: customized for specific workflows
Whether it’s agriculture (e.g. Agridex), logistics, education or global aid, each industry has its own workflows, user expectations, compliance requirements and payment rhythms. Specialized builders are able to speak jargon, plug into existing tools, and solve problems that generalists can’t. Once they gain trust, they can add additional financial services such as credit, fund management or insurance. Focus brings user stickiness and profits.
4.2 Major Crypto Economies in Africa
(State of Crypto Report 2024: New data on swing states, stablecoins, AI, builder energy, and more)
A. Nigeria — The Hub of Crypto Activity in Africa
Nigeria, Africa’s most populous country, is leading the way in stablecoin adoption, driven by a booming fintech sector and severe economic challenges. Nigeria’s economy has faced a series of shocks in recent years. Low oil prices, a key driver of its export economy, combined with the impact of the coronavirus pandemic and supply chain disruptions have led to prolonged financial uncertainty. Nigeria’s inflation rate is among the highest in Africa, even higher than the entire French-speaking region. As the naira continues to depreciate, stablecoins have become an important tool for Nigerians looking to preserve their wealth and transact globally.
The country ranks second overall in the Chainalysis team’s Crypto Global Adoption Index. The country received approximately $59 billion worth of cryptocurrencies between July 2023 and June 2024. Nigeria is also one of the leading markets for mobile crypto wallet adoption, second only to the United States. The country has actively worked on regulatory clarity, including through incubation programs, and has seen significant growth in the use of stablecoins for everyday transactions such as bill payments and retail purchases.
(Sub-Saharan Africa: Nigeria Takes #2 Spot in Global Adoption, South Africa Grows Crypto-TradFi Nexus, Chainalysis)
As in Ethiopia, Ghana, and South Africa, stablecoins are an important part of Nigeria’s crypto economy, accounting for approximately 40% of all stablecoin inflows in the region—the highest in Sub-Saharan Africa. Nigerian users report a high frequency of transactions and the strongest understanding of stablecoins as a financial instrument, not just an asset class.
Crypto activity in Nigeria is driven primarily by small retail and professional-scale transactions, with about 85% of transfers valued at less than $1 million. Many Nigerians rely on stablecoins for cross-border remittances due to the inefficiency and high costs of traditional remittance channels. Sodipo noted: “ Cross-border remittances are the main use of stablecoins in Nigeria. It is faster and more affordable. ”
“Daily activities such as bill payments, mobile top-ups and retail purchases are increasingly powered by cryptocurrencies. People are beginning to see the real-world utility of cryptocurrencies, especially for everyday transactions, as opposed to the previous view of cryptocurrencies as a means to get rich quick.” — Moyo Sodipo, CEO & Co-founder of Busha, a Nigerian cryptocurrency exchange
In addition to the traditional financial system, DeFi platforms offer Nigerians new opportunities to earn interest, take out loans, and participate in decentralized exchanges. “DeFi is a key growth area as users explore ways to maximize returns and access financial services that they may not otherwise have access to,” said Sodipo.
(GPR 2025: the past, present and future of payments, WorldPay)
We can see in the above figure that cryptocurrency as a means of payment has accounted for 1% of online E-com and offline POS in Nigeria and is classified as Digital Payments. In the WorldPay report, similar countries include: Argentina, Brazil, India, Nigeria, Philippines, Singapore, Turkey.
With inflation, remittances, and financial channels driving the adoption of stablecoins, I believe that the adoption of stablecoins will be reflected in various scenarios. Nigeria has become an ideal testing ground for stablecoins in Africa. The role the country plays in the construction of stablecoin infrastructure will determine the direction of the technology's development on the African continent.
In December 2023, the Central Bank of Nigeria lifted its ban on banks that provided services to cryptocurrency companies, which also played a key role in the popularity of cryptocurrencies. "Since the banking ban was lifted, it has opened up a lot of possibilities for collaboration and smoother transactions," Sodipo explained. Building on this, in June 2024, the Nigerian Securities and Exchange Commission (SEC) launched the Accelerated Regulatory Incubation Program (ARIP), requiring all virtual asset service providers (VASPs) to register and undergo an assessment before receiving full approval. "The industry is optimistic about the ARIP; it is a shift away from uncertainty and a positive step towards regulatory clarity," said Sodipo.
These policy initiatives will enable companies across industries to consider moving from traditional payment channels to stablecoin infrastructure. While compliant solutions are not perfect, every business that adopts stablecoins can prove to incumbents that stablecoins are a reliable, secure, compliant, and better solution to traditional payment problems.
B. South Africa – TradFi institutional adoption drives market development
As Africa's largest economy, South Africa has positioned itself as one of the most advanced Web3 markets in Africa, with an advanced regulatory framework and strong institutional investor interest. The country has become one of the largest cryptocurrency markets on the continent, with $26 billion in transactions over the past year. Unlike many African countries where cryptocurrency adoption is mainly driven by retail investors, South Africa is seeing increasing institutional investor participation, with licensed companies and traditional financial institutions entering the space.
Since the end of 2023, stablecoins have continued to grow on local exchanges in South Africa - with a month-on-month increase of more than 50% in October 2023. Stablecoins have replaced Bitcoin as the most popular cryptocurrency in recent months.
(Sub-Saharan Africa: Nigeria Takes #2 Spot in Global Adoption, South Africa Grows Crypto-TradFi Nexus, Chainalysis)
The key driver of cryptocurrency growth in South Africa is its clear regulatory stance. The country has classified cryptocurrencies as financial products, creating a structured legal environment that provides a clear regulatory framework for businesses and investors. In March 2024, South Africa approved 59 cryptocurrency operating licenses, paving the way for wider adoption of stablecoins. By setting up regulatory guardrails, the government aims to attract investment, protect users from cybercrime, and expand access to low-cost digital asset transactions.
South Africa's intergovernmental fintech task force is actively refining its approach to stablecoin regulation and plans to formally classify stablecoins as a distinct subset of crypto assets. This move fits in with the country's broader financial modernization and digital payments initiatives, which aim to ensure that stablecoins can be properly integrated into the financial ecosystem. The 2024 budget review further underscores the government's commitment to structural reforms, improved public financial management, and the development of new policies focused on stablecoins and blockchain-based digital payments.
The growing interest from institutional investors has also sparked discussions around bank-issued stablecoins. As traditional financial institutions explore the stablecoin model, South Africa may soon see regulated, bank-backed digital assets, which will further promote the mainstream adoption of stablecoins. Led by startups such as VALR, Luno and Altify, South Africans have begun using stablecoins to diversify their investments, make payments and access financial services more efficiently.
With a developed financial sector, clear regulation, and the growing integration of cryptocurrencies with traditional finance, South Africa is becoming a leader in the adoption of stablecoins on the continent. With the government improving its policy framework and institutions becoming more involved, South Africa is laying the foundation for stablecoins to play a central role in its growing digital economy.
C. Kenya - Becoming East Africa’s Stablecoin Hub
Kenya has long been at the forefront of financial innovation in Africa. From pioneering mobile money to early embracing of Web3, the country has continually moved beyond the traditional banking system to more efficient digital solutions. Today, Kenya is positioning itself as a key player in the stablecoin revolution with its strong fintech infrastructure, open regulatory environment, and growing demand for alternative financial services.
One of Kenya’s biggest strengths is its deeply ingrained mobile money culture. Launched by Safaricom in 2007, M-Pesa has become the backbone of Kenya’s financial system, processing around 60% of the country’s GDP and covering over 90% of the adult population. Its success lies in providing banking services without the need for a physical bank, allowing millions of Kenyans to deposit, withdraw, transfer money, and even get credit through their mobile devices. Stablecoins complement this ecosystem by allowing users to hold value in a stable currency and make frictionless transactions around the world.
In addition to mobile money, Kenya’s regulatory environment has been an important driver of fintech and Web3 development. Unlike many countries that take a restrictive stance on digital assets, the Kenyan Capital Markets Authority (CMA) actively promotes innovation through a regulatory sandbox, allowing blockchain-based companies to test and refine their products.
Kenya’s need for stablecoins stems from its lack of formal financial services. Small and medium-sized enterprises (SMEs) in particular face significant barriers to credit, with Kenyan businesses seeking approximately $1.1 billion in loans in 2021 alone. Stablecoin-powered lending solutions can fill this gap, providing cheaper, faster, and more convenient credit options for businesses and individuals.
Kenya has also become a global leader in tokenized private credit. According to RWA.xyz, Kenya ranks first in the world in tokenized real-world asset lending, with $73.8 million in loans, surpassing larger economies such as India and Brazil. This reflects not only Kenya’s strong demand for alternative financing solutions, but also the country’s ability to integrate blockchain-based credit models into its financial ecosystem.
With a mature mobile money landscape, advanced regulatory bodies, and growing adoption of stablecoins, Kenya is quickly becoming an important stablecoin hub in East Africa. As more fintech companies build stablecoin-based solutions, Kenya’s role in shaping the region’s financial future will continue to grow.
(Nika, photographed in downtown Kenya, May 2025)
5. Adoption barriers that need to be overcome
While we are seeing strong progress from builders in Africa, the ideal testing ground for stablecoins, there are still structural challenges facing stablecoin infrastructure. To scale further, builders must navigate difficult obstacles, some of which are technical and others political.
5.1 Policy risks and regulatory ambiguity
While the largest countries have made progress on regulation, most others remain in a regulatory gray area. Stablecoins are neither banned nor fully legalized, slowing corporate adoption and hindering the entry of institutional capital.
As trading volumes grow, enforcement efforts are likely to increase in terms of capital controls, taxation, anti-money laundering and reporting. Progress in this area will come from active engagement with regulators. Founders, industry associations and regional sandboxes can help shape the rules.
“Busha is proud to be the first licensed exchange in this market and we are leading this revolution, providing the liquidity, trust, and infrastructure needed to power a stablecoin-driven economy. This is not the future, it’s already here.” - Michael Adeyeri, Co-Founder & CEO of Busha
5.2 Monetary Sovereignty
Governments are increasingly concerned that stablecoin wallets are creating a “shadow dollar economy.” Some are exploring local alternatives, such as ZARP (Zimbabwe Digital Asset Reserve Platform) and cNGN (a naira-backed stablecoin), or piloting central bank digital currencies (CBDCs) to maintain monetary control.
“The dominance of dollar-backed stablecoins reflects a crisis of confidence…Without decisive policy innovation and encouragement of regulated, competitive naira-backed stablecoins like cNGN, African countries risk ceding control of their finances to offshore stablecoin issuers.” — Adedeji Owonibi, Founder & COO of Convexity (cNGN Issuer)
5.3 Liquidity Gap
Fast cross-border payments require capital to be available at the right time, place, and currency. Providers like Wise and Thunes solved this problem by pre-funding accounts, but with the movement of stablecoins, this responsibility has shifted to market makers, OTC desks, and other liquidity providers. As trading volumes grow, capital remains a limiting factor in each corridor.
Payment finance (PayFi) companies like MANSA and Arf are filling this gap. By using stablecoins as a transport layer, they provide real-time liquidity to fintechs, orchestrators, and SMEs.
“Real-time, low-cost liquidity not only makes payments faster, it unlocks entirely new models, such as just-in-time supplier financing. This is a game changer for founders who have been building their businesses around settlement risk.
The next step is to embed this dollar liquidity directly into the applications and tools that emerging market businesses already use, so that value can flow as easily as a WhatsApp message." - Mouloukou Sanoh, CEO & Co-Founder, MANSA
5.4 Fraud, Scams and Consumer Trust
Cryptocurrency adoption introduces new risks, from phishing scams and fake wallets to poorly secured apps. These vulnerabilities erode user trust, especially among first-time users. The responsibility to ensure security falls on consumer apps. Trusted design, risk tools, and education must be part of the core product.
“Users are the biggest victims of malicious behavior. Users will only continue to use and recommend platforms they believe are safe.” - Zach Bijesse, CEO & Co-Founder at Archer
5.5 Awareness and education
Outside of crypto-native circles, many merchants and agents still find stablecoins difficult to understand. Continued “last mile” adoption depends on ease of use, education, and demonstrating real value.
“In many rural areas and even urban communities, awareness of cryptocurrencies is still low because they seem too technical.” — Xino Zee, Lead at Send Africa
These barriers are real, but they are being overcome every day. Rather than waiting for conditions to be perfect, successful teams will build resilience, earn trust, and adapt across channels and communities as regulation improves.
6. Stablecoins are redefining African finance
Stablecoins are fundamentally changing the financial landscape of emerging markets by providing a convenient, efficient and reliable alternative to the traditional banking system. Unlike institutionally driven adoption in Western economies, Africa is not waiting for a global consensus on stablecoins, but has already started building one. Emerging markets such as Sub-Saharan Africa are experiencing grassroots growth in small transfers, remittances, peer-to-peer payments and value storage by retail users. At the same time, driven by fintech companies, actual applications are being carried out in areas such as remittances, trade, credit and savings.
The past few years have proven that stablecoins are not just an alternative, but an inevitable trend in the future of African currencies. They can bypass broken financial tracks, provide stable value, and enable instant, low-cost transactions, making them an important tool for individuals, businesses, and even institutions. With the construction of more infrastructure and the improvement of regulatory transparency, stablecoins will surely be more deeply integrated into Africa's financial system.
This is where the future of programmable money is prototyped. This is an area worth learning, building, and investing in.
We are developing a series of documentaries to tell these stories - stories of humanity using stablecoins in the last mile - because in order to fully realize the stablecoin opportunity, we need to better understand the conditions that drive stablecoins and will continue to drive adoption in markets where the technology has found product-market fit. - Justin Norman, Founder of The Flip
He noted that to understand stablecoin adoption in Africa, one needs to look at the people at the “last mile,” not just the technology.
Africa’s demographic structure is in place, and the demand is obvious. As global regulation gradually improves, this momentum will only accelerate. Stablecoins are no longer a hype term in the Crypto market, but a system-level change that is decoupled from traditional finance and reconstructed on the chain .
Everyone sees different aspects, but they all point to the same future - a world where there is no need for banks, but everyone can "have a bank".
