By Danny Oyekan, Founder, Blockfinex
In many parts of Africa, inflation isn’t something you read about in reports; it’s something you feel in your pocket. When your currency loses 40% of its value in a single year, like the naira did in 2023, that’s not theory – that’s rent, school fees, and groceries slipping through your fingers. In countries like Zimbabwe, it’s worse; triple-digit inflation has become a regular occurrence. Across the continent, people are doing whatever they can to hold on to the value they’ve worked for. And increasingly, that means turning to something many never expected: stablecoins.
But it’s not hype. It’s a lifeline.
To many people, stablecoins might sound like just another crypto buzzword, the digital tokens tied to the dollar or euro, buried somewhere deep in the blockchain playbook. But here in Africa, they’ve become something far more useful. Not because they promise to make you rich, but because they help you not to go broke. This promised stability, in a region used to volatility, is quietly revolutionary. This isn’t about chasing the next Bitcoin. It’s about protecting what you already have.
In Nigeria, stablecoins now make up more than 70% of crypto transactions, according to Chainalysis. That’s not by accident. People are swapping naira for USDT or USDC, not because it’s trendy, but because they’re tired of watching their hard-earned money lose value overnight.
Real Problems, Real Solutions.
But this isn’t just a Nigerian issue. In Ghana, for example, businesses struggle to access dollars through banks, so they’ve turned to stablecoins to pay for imports. In Sudan and Ethiopia, where access to global banking is severely limited, stablecoins help to work around these systemic issues for remittances and trade. In Kenya and South Africa, they’re being used for cross-border B2B payments, fast, cheap, and without a traditional bank. This isn’t about crypto dreams. It’s about economic survival.
The Real DeFi? Access, Not Apps.
People talk about Decentralised Finance (DeFi) as if it is some complex Web3 ecosystem with flashy protocols. But in Africa, DeFi looks much simpler: permissionless access to U.S. dollars. That’s the real revolution. And stablecoins make that possible, easily. You don’t need a bank account. You don’t need a broker. You just need a smartphone and a crypto wallet. That’s it. For the 57% of African adults who are unbanked, that’s not just convenience, that’s empowerment.
I’ve seen young traders, market women, freelancers, and small business owners using stablecoins to sidestep bureaucracy, FX issues, and banking hurdles. In a world where opening a bank account can still feel like applying for a visa, this kind of access is game-changing.
Let’s Be Honest: It’s Not All Smooth Sailing
Of course, stablecoins aren’t perfect. Some are only as solid as the reserves backing them, and not every issuer is transparent. A badly run stablecoin crashing could be devastating, especially in places already battling fraud and Ponzi schemes. And while stablecoins are easy for the digitally connected, they’re still out of reach for many. Infrastructure is patchy. Smartphone access is growing but uneven, and converting fiat to stablecoins (and back) is often risky, relying on informal channels that can go sideways fast.
Yes, they can be used for shady stuff, just like cash. But cracking down too hard can backfire. When Nigeria banned crypto-related bank transactions in 2021, it didn’t stop people. It just pushed things into the shadows. That’s what happens when policy ignores what’s happening on the ground.
Don’t Ban It, Shape It
Regulators have a tough job. They don’t want a repeat of the mobile money explosion that caught governments off guard. But the answer isn’t to ban stablecoins. The smarter path is to build a framework that makes them safer to use. South Africa’s fintech working group is already on it, exploring stablecoin use cases and designing guardrails. Ghana and Kenya are studying both stablecoins and central bank digital currencies.
Even Nigeria, with its flawed eNaira rollout, has shown some willingness to experiment.
But let’s be practical. Stablecoins don’t have to replace central banks. But they can complement them. The right kind of regulation can protect users, keep fraud in check, and allow innovation to keep flowing.
VCs Should Pay Attention, With Their Eyes Open
Here’s what baffles me: despite all this real-world usage, Africa’s stablecoin space isn’t getting the attention (or investment) it deserves. In 2022, African blockchain startups pulled in less than 2% of global crypto funding. That’s tiny. Sure, the concerns are valid: unclear regulations, lack of exit options, past scams. But to write off the space entirely is to miss the bigger picture.
The need is real. The market is active. And innovation is happening—whether anyone’s watching or not. The startups worth betting on will be the ones who understand both crypto and context: who know how to build infrastructure, educate users, and stay compliant.
Stablecoins Aren’t the Future, They’re Already Here.
While much of the world is still debating what stablecoins might do, Africans are already using them to solve real problems, right now. This continent isn’t waiting to catch up. We may be ahead in showing what real-world crypto adoption looks like.
Stablecoins aren’t perfect. But they’re proving useful. And sometimes, useful beats flashy.
In a region where stability is scarce, they offer something rare: a chance to hold on to value, plan for tomorrow, and build despite the chaos. That’s not just innovation. That’s survival.
