Africa’s Stablecoin Boom Is Entering a New Phase: From Adoption to Infrastructure

What to Know

• Stablecoins have moved beyond experimentation in Africa and are now being used for real-world payments, treasury operations, remittances, and liquidity management.
• The market’s biggest challenge is no longer adoption but scaling infrastructure.
• Regulation is becoming clearer across several African markets, but implementation remains inconsistent.
• Competition is increasing as fintech incumbents, banks, and well-funded startups enter the space.
• Local-currency stablecoins, such as cNGN and ZAR-backed stablecoins, are emerging as settlement infrastructure rather than as speculative assets.
• The next phase of growth will be determined by banking access, compliance, liquidity, and execution.

When the crypto wave began sweeping the continent, one of the questions the industry had was whether stablecoins had a real use case on the continent. That question has been answered.

Between July 2023 and June 2024, stablecoins accounted for 43% of Africa’s total crypto transaction volume. Among crypto natives on the continent, there’s a 79% adoption rate of stablecoins.

Stablecoins are now used for cross-border payments, local merchant settlement, treasury management, dollar access, and remittances across dozens of African markets. Adoption is no longer the story.

The Stablecoin Adoption Debate Is Over

The conversation that needs to be had is whether the African regulatory space and industry stakeholders are prepared to create the environment and infrastructure required for stablecoins to formally enter Africa’s financial ecosystem.

On the industry side, the shift has begun. Flutterwave, one of Africa’s leading fintech companies, has made major moves in the stablecoin infrastructure space.

In 2025, Flutterwave partnered with Polygon and joined the Circle Payment Network. By January 2026, they launched stablecoin wallets with Nuvion and Turnkey, and added stablecoin payment cards via Kulipa in April. Most recently, in June, they announced a partnership with Tempo, a payments-focused Layer 1 blockchain built by Stripe and Paradigm.

“We are building the infrastructure for how money should move in a modern, connected world,” Flutterwave CEO Olugbenga Agboola said at the announcement, framing the Tempo deal as part of a broader bet on multi-rail stablecoin infrastructure.

Regulation Progresses, But Implementation Is the Real Bottleneck

Regulatory clarity, where it exists, is a necessary but insufficient condition. What most markets still lack is the infrastructure required for compliance and for creating the banking infrastructure needed for stablecoin activity to run smoothly at scale.

Nigeria has moved further than most. The Investments and Securities Act 2025 formally recognised digital assets as securities under the oversight of the Securities and Exchange Commission (SEC).

The Central Bank of Nigeria has also relaxed prior restrictions on banks working with licensed digital asset providers. Nigeria’s licensing framework for Digital Asset Exchanges now requires a minimum capital threshold of ₦2 billion, a signal that the market is being pushed toward consolidation and institutionalisation.

Still, friction persists. Traditional banks continue to freeze transfers linked to stablecoin settlement. Compliance teams lack standardised procedures for digital asset activity. Regulatory approval does not automatically translate into smooth operations on the ground.

South Africa offers a cautionary contrast. The 2025 Budget Review promised a stablecoin and cross-border crypto regulatory framework. The South African Reserve Bank flagged stablecoins as an emerging financial stability risk in its 2025 Financial Stability Report.

The Intergovernmental Fintech Working Group published a diagnostic report in March 2025, finding that non-bank entities issued all ZAR-backed stablecoins in circulation without legally segregated reserves.

Yet despite all of this activity, no formal regulatory framework has emerged. The market is operating without guardrails.

South Africa’s National Treasury’s draft Capital Flow Management Regulations, published in April 2026, triggered significant industry backlash over its enforcement provisions, and the public comment deadline was extended to June 30, 2026.

The divergence between Nigeria’s structured progression and South Africa’s regulatory lag is part of the problem. The stablecoin policy conversation is advancing unevenly, and the gap between policy intent and operational reality is still wide.

Why Regulators Are Moving Carefully

African central banks are managing a genuine set of competing pressures.

Stablecoins, particularly dollar-denominated ones like USDT and USDC, raise direct concerns. Financial and monetary sovereignty, capital flight, and foreign exchange management are just some of those concerns.

Dollar-stablecoins, widely used for savings or transactions, represent a quiet form of dollarisation that can erode a central bank’s monetary policy transmission.

South African Reserve Bank Governor Lesetja Kganyago framed the risk bluntly at the 2026 Warwick Economics Summit. He warned that stablecoins “could break apart” and stressed central banks’ responsibility to “protect the oneness of money and the affordability of money to the public.”

Beyond monetary policy, there are legitimate concerns around anti-money laundering, counter-terrorism financing, and financial stability. 

Concerns that any credible stablecoin operator must address, not dismiss. Most of the public conversation around African stablecoins focuses on innovation potential. The regulatory lens is necessarily wider.

The Competitive Landscape Is Changing Fast

The early phase of African stablecoin adoption was defined by small startups operating in regulatory grey zones and solving immediate market problems. 

They guaranteed users FX access, dollar savings, and cheaper remittances. That era is giving way to a more structured, better-capitalised competitive environment.

Flutterwave’s push into stablecoin infrastructure is the clearest example of the shift. Large, well-resourced fintechs are now building the rails, not just using them. Rivals, including Yellow Card and Grey, have launched business-focused stablecoin products. Paga has partnered with Sui and Crossmint on stablecoin infrastructure. Paystack has signalled stablecoin ambitions. NALA continues expanding its infrastructure footprint.

Stablecoin routing is becoming commoditised. The transaction-fee advantage that early movers enjoyed is being compressed as competition increases and infrastructure becomes more standardised. Smaller operators who built businesses on simple on/off ramp margins face an increasingly difficult strategic question: what do you own that a well-capitalised fintech cannot replicate?

The answer will likely be found in niche verticals and corridors, or deep compliance and banking relationships in markets where larger players lack a foothold. The market is beginning to resemble traditional payments. Scale, distribution, and regulatory access matter as much as the technology itself.

The Rise of Local-Currency Stablecoins

Dollar stablecoins are popular across the continent. They dominate in transaction volume and ownership. Despite this, there is a gradual emergence of local-currency stablecoins as a payment infrastructure.

Nigeria’s cNGN, issued by WrappedCBDC, a consortium comprising Convexity Technologies, Interstellar, and AlphaGeek, is Africa’s first regulated stablecoin. It launched on licensed exchanges in February 2025 under the SEC’s Accelerated Regulatory Incubation Programme. It is pegged 1:1 to the Nigerian naira and designed for collections, payouts, local settlement, and cross-border transactions.

As of October 2025, cNGN’s reserve structure comprised 54% bank deposits and 46% treasury bills and money market instruments managed by CardinalStone.

The stablecoin is listed on Busha, Quidax, and Xend Finance, with transaction fees for naira movement typically ranging from ₦150 to ₦500, which is significantly lower than the costs of converting dollar stablecoins.

The cNGN’s value proposition is instructive. The stablecoin’s significance lies not in the monetary strength of the naira, but in the rail it is building. An instant-settlement digital naira infrastructure, if it scales, could support trade, commerce, cross-border transactions, and software integration in ways that legacy banking infrastructure simply cannot match.

South Africa’s ZAR-backed stablecoins, all currently issued by non-bank entities, are in a similar early position. Technically speaking, they are functional and circulating. Without a regulatory framework, it will be difficult for them to reach institutional scale. Tanzania is further behind, with local stablecoin exploration occurring through regulatory sandbox programmes.

Local Stablecoins as Infrastructure, Not Speculation

Local-currency stablecoins are not investment assets competing with the dollar. Their value is not in capital appreciation. Their value is in transaction velocity and the ability to embed money movement into software workflows.

Programmable settlement via smart contracts enables automated payment flows, improved reconciliation, and 24/7 operation independent of banking hours.

For businesses operating across African markets, it is a meaningful operational upgrade.

The longer-term potential is automated FX management, on-chain liquidity pools, and regional settlement systems that reduce reliance on dollar intermediation. Whether any of this materialises depends heavily on local stablecoin issuers securing the banking relationships and regulatory standing needed to operate at scale.

Infrastructure Wins the Next Phase

The African stablecoin market is entering its second phase, and the dynamics of that phase are different from the first. Phase one was about proving demand. It succeeded. Phase two is about whether stablecoins can function as a trusted financial infrastructure within regulated, banking-integrated systems.

The winners of this phase are firms that have solved the harder problems. It is an infrastructure bet. Whoever controls the rails, builds the compliance layer, and owns the corridors where money actually needs to move, wins the race.