When African banks and mobile network operators make a decisive move to adopt stablecoin services for institutional, cross-border and treasury transactions, Africa will reach a pivotal tipping point in adoption.
This is according to Reece Merrick, MD of Middle East and Africa at crypto firm Ripple, speaking during an online panel discussion moderated by Adesoji Solanke, head of fintech and banks investment banking origination at Absa.
The discussion, organised by Absa, centred on how stablecoins are reshaping the future of financial services on the African continent.
The panellists agreed that as stablecoins move from concept to real-world application, they are emerging as a critical layer of digital financial infrastructure. With Africa’s expansive mobile money ecosystem, cross-border trade corridors and uneven access to traditional banking rails, stablecoins offer new possibilities to reduce transaction costs, accelerate settlements and widen financial inclusion, they noted.
According to Merrick, Africa’s stablecoin story is only at its midpoint. The infrastructure is being built, the use cases are proven and regulation is maturing.
What remains is scale – and that, he suggested, will come when banks and mobile network operators offer services for the emerging technology.
Merrick explained: “When I think of the biggest players that have the ability to move the needle when it comes to stablecoin adoption, certainly in Africa, I think fintechs and infrastructure providers have done a phenomenal job to date. But once banks and operators step into this space, I really do believe we can see huge acceleration… that will really be a tipping point for adoption.
“If you look at the institutional side of stablecoin services, the large fintech players trust their banks with their major assets, and I think that certainly they have the ability help scale adoption as well, which is key here. Pending regulation, of course.”
According to Merrick, once regulated and when banks and large telcos embed stablecoins into custody, payments and treasury services, adoption will accelerate sharply across the continent.
Stablecoins – digital tokens typically pegged 1:1 to fiat currencies such as the US dollar – were initially positioned as a less volatile alternative to assets like Bitcoin. But their role has evolved.
Several South African banks − including Absa, Standard Bank and Discovery Bank − are actively working on the introduction of Rand-backed stablecoins to improve cross-border payments, enhance transaction speed and provide lower-cost financial infrastructure.
In the telecoms space, Vodacom and Safaricom's M-Pesa mobile money platform have collaborated withADI Foundation to integrate stablecoin technology for cross-border payments in Africa. MTN and Airtel Africa have also announced plans to integrate stablecoins and other crypto-linked services into their digital payments ecosystem.
Earlier this month, fintech Lesaka collaborated with financial institutions to introduce ZAR Universal, an institutional-grade stablecoin pegged to the South African Rand.
Preparing for stablecoin era
Also speaking during the panel discussion, Rob Downes, head of digital assets at Absa CIB Africa, explained how the bank is preparing for the stablecoin era.
“We provide reserve accounts for stablecoin issuers, and these reserves are independently ring-fenced. Independent auditors come and verify the balances, so there is full transparency and trust in the system. This is critical for issuers who want to move money faster and securely across borders.”
He also highlighted Absa’s own experimentation with digital assets. “We’re currently building a stablecoin and exploring tokenised solutions that will allow us to integrate stablecoins into mainstream banking operations. As regulations continue to evolve, our goal is to provide clients with faster, cheaper and more efficient ways to transact within Africa and internationally.”
According to Downes, one development to watch closely is the role of mobile network operators in offering stablecoin-related services across the continent.
“Digital wallets and mobile money are almost default ways of paying and being paid in many of our markets in Africa… I think they will participate and start having a big impact.”
Mobile money penetration in various parts of Africa provides a ready distribution layer.
If stablecoins are embedded within these wallets – abstracting away wallet addresses, gas fees and blockchain complexity – mainstream consumers could access digital dollars without knowing they are using blockchain rails, he noted.
Soaring adoption
According to the Stablecoin Utility Report compiled by YouGov, Africa has emerged as the global frontrunner in stablecoin adoption, with Nigeria and SA leading the charge with the fastest adoption rate, as transactions surge across the continent.
Lasbery Chioma Oludimu, VP of operations and MD ofstablecoin payments infrastructure firm Yellowcard, stated that stablecoins are gaining significant traction in Africa as a hedge against inflation and a tool for remittances, with over $54 billion in transaction volume moved in 2025.
Nigeria alone processed nearly $22 billion in stablecoin transactions between July 2023 and July 2024, she pointed out.
“Stablecoins are actually solving real problems,” Oludimu said. “They’re not being used for speculation… they’re solving some of the issues we have in the traditional finance sector.
“In most markets in Africa, we have foreign exchange scarcity. People are now using stablecoins to pay for invoices abroad… instead of going to the bank and queuing for days or weeks.”
Stablecoins in Africa also resolve the issue of limited access to foreign exchange (forex), and costly, slow cross-border remittances. By offering a pegged, digital alternative to volatile local currencies, they enable cheaper, faster transactions and financial inclusion for unbanked populations, saidOludimu.
Corporates, she continued, are also using stablecoins to manage liquidity, cash flow and cross-border funds more efficiently.
“Airlines that have offices in some African markets are having issues repatriating their funds. Stablecoins allow them to repatriate without depreciation and in good time.”
“What will really make a difference is the financial institutions. I want to see financial institutions integrate into what Yellowcard has built… everyone has a role to play in this ecosystem.”
Gating factors
Downes acknowledged that some central banks have flagged concerns, particularly around dollar-denominated stablecoins and their potential impact on monetary sovereignty.
However, he noted that regulatory positions are becoming clearer across markets, such as Kenya, Ghana, Mauritius and SA.
“The majority of central banks are supporting regulation, which is great,” he said. “It’s not a case of saying we don’t want to use stablecoins. It’s a case of saying: how do we incorporate them into our regulatory programmes?”
Oludimu argued that structured regulation – including capital requirements and reporting obligations – is essential to reduce illicit activity and prevent “free-for-all” participation.
“You can’t wake up any day and say, ‘I want to play in this space.’ You need financial capacity and a regulatory framework.”
During an interview with ITWeb, Dr Wiehann Olivier, partner and head of fintech, digital assets and private equity at Forvis Mazars South Africa, noted the South African Reserve Bank (SARB) is currently taking a cautious, risk-focused approach to stablecoins.
“The SARB is recognising their growing use, while classifying them as a potential structural financial stability risk,” notes Dr Olivier.
“Rather than regulating them through a dedicated framework, SARB is monitoring developments through its financial stability review. Despite repeated policy signals and a diagnostic conducted by the Intergovernmental Fintech Working Group on the local stablecoin landscape, there is still no formal regulatory regime governing issuance, reserve protection, redemption rights, or exchange-control treatment in SA.”
The key gaps in SA remain legal certainty, consumer protection and clarity on how stablecoins, particularly rand-backed tokens, fit within payments, banking and cross-border capital flow rules, he asserts.
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