Across Africa, stablecoins are increasingly being used as a cheaper and faster option for remittances, and remittances are becoming “more important than aid” on the continent, according to Vera Songwe, former UN Under-Secretary-General of the United Nations.
Speaking at the World Economic Forum plate On Thursday in Davos, Switzerland, Songwe said time-honored money transfer services in Africa often cost about $6 for every $100 sent, making cross-border payments steep and leisurely.
She said stablecoins reduce fees and settlement times, enabling individuals and miniature businesses to transfer money in minutes rather than waiting days for cross-border payments to settle.
Songwe said that since the Covid-19 pandemic, inflation has exceeded 20% in “about 12-15 countries” across Africa, arguing that stablecoins allow a store of value in currencies that are less prone to inflation and serve as a financial safety net. She said:
650 million people in Africa do not have access to a bank account. Thanks to your smartphone, you have access to stablecoins, so you can save in a currency that is not exposed to inflation fluctuations and does not cause poverty.”
According to Songwe, stablecoin employ is highest in Egypt, Nigeria, Ethiopia and South Africa, countries with high inflation or tight capital controls. She added that most transactions are conducted by miniature and medium-sized enterprises, indicating that stablecoins function as a broad tool for financial inclusion.
Songwe is chair and founder of the Liquidity and Sustainability Facility and non-resident senior fellow at the Brookings Institution. She previously served as UN Under-Secretary-General and Executive Secretary of the UN Economic Commission for Africa.
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African countries are developing cryptocurrency legislation
Chain analysis report in September showed that sub-Saharan Africa is one of the fastest-growing regions in the world in terms of cryptocurrency adoption. From July 2024 to June 2025, the region achieved over $205 billion in onchain value, up approximately 52% year-on-year, ranking it third in the world.
As cryptocurrency adoption accelerates across the continent, national responses are beginning to diverge, ranging from formal legalization and tax integration to more cautious, risk-focused supervision.
In December, Ghana legalized cryptocurrency trading after parliament passed the Virtual Asset Service Providers Act, establishing a formal regulatory framework for the industry. Bank of Ghana Governor Johnson Asiama said the law allows crypto activities while providing authorities with tools to manage the associated risks.
On January 13, Nigeria implemented recent rules requiring crypto service providers to link transactions to users’ tax identification numbers. The change aims to bring cryptocurrency activity into the tax net through identity-based reporting, reducing the need for direct blockchain oversight by regulators.
In South Africa, the national bank recently flagged crypto assets and stablecoins as an emerging risk to financial stability amid continued growth in local employ.
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