Nigeria's Central Bank Embraces Stablecoins in Payment Plans
This is Follow the Money , our weekly series that unpacks the earnings, business, and scaling strategies of African fintechs, financial institutions, companies, and governments. A new edition drops every Monday. The Central Bank of Nigeria (CBN) mentioned stablecoin(s) at least 68 times in its newly released Payments System Vision 2028 (PSV 2028). For a regulator that once wanted banks nowhere near cryptocurrency businesses, this is a remarkable shift. A stablecoin is a digit
The Central Bank of Nigeria (CBN) has significantly shifted its stance on digital currencies, mentioning stablecoins 68 times in its Payments System Vision 2028. This marks a departure from its previous opposition to cryptocurrency activities. Stablecoins, which are tied to stable assets like fiat currencies, are increasingly used for cross-border transactions and trade in Nigeria. In 2021, the CBN banned crypto-related accounts, citing risks to financial stability and consumer protection. Now, the CBN is exploring a regulatory framework for stablecoins to address payment and foreign exchange challenges. Over 65% of crypto inflows into Nigeria are in stablecoins, with USDT and USDC being the most common. Nigeria has become the largest destination for stablecoin inflows in Sub-Saharan Africa, with significant growth in crypto-asset value. The rise in stablecoin usage is linked to high inflation and naira instability. The CBN sees stablecoins as a potential tool to improve Nigeria's financial infrastructure.
This shift highlights the evolving role of stablecoins in addressing Nigeria's financial challenges and could influence future regulatory approaches in the region.
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