In cities like Nairobi and Lagos, stablecoins such as USDT and USDC are becoming essential tools for combatting inflation, reducing expensive remittance fees, and facilitating transactions via mobile wallets like M-Pesa.
Key Insights:
- Stablecoins are becoming common for savings, purchases, and trades in Nairobi and Lagos.
- Economic pressures like inflation and high remittance costs drive their adoption.
- Easy integration with mobile money makes stablecoins user-friendly and effective.
- There are risks including issues related to reserves, fraud, and varying regulations.
On a Tuesday morning in Nairobi, Amina sends an invoice to a client in Berlin. By afternoon, the funds arrive in her wallet via USDC and she swiftly converts it to M-Pesa, a service now streamlined through platforms like Kotani Pay that connect stablecoins to mobile transactions.
In Lagos, Chinedu, a shopkeeper, relies on Tether’s USDt to maintain his inventory, allowing him to manage stock without the risk associated with the naira’s fluctuations.
From July 2023 to June 2024, Nigeria saw nearly $22 billion in stablecoin activities — the highest in Sub-Saharan Africa. The economic advantages are clear, with traditional remittance services charging an average of 8.45% (Q3 2024), while digital platforms have reduced fees closer to 4%. This makes stablecoins attractive for those making $200-$1,000 transactions crucial for families and businesses.
The Broader Economic Landscape
Inflation in Nigeria remains high despite some mitigation efforts, with a consumer price index of 21.88% recorded in July 2025. Currency uncertainties since 2023 have exacerbated the situation for households and importers relying on USD pricing.
Kenya’s situation is somewhat stable, with inflation at 4.5% as of August 2025, but currency volatility sustains demand for hard currencies among traders.
The Remittance Prices Worldwide report highlights that Sub-Saharan Africa has some of the priciest remittance channels globally, making stablecoins a financially viable alternative.
Practical Use Cases for Stablecoins
- Savings: Individuals convert local currency savings into stablecoins to preserve value against inflation.
- Payroll Transactions: Freelancers often receive payments in USDC, exchanging only as necessary for local currency.
- Trade and Inventory Management: Businesses utilize stablecoins for supplier payments, with Yellow Card reporting this as a rapidly growing segment.
- Remittances: Many prefer stablecoin transfers due to favorable local cash-out options over traditional services.
Regulatory Landscape
In Nigeria, the Central Bank’s shift from prohibiting digital assets in December 2023 to allowing some forms of regulation indicates a changing landscape. However, scrutiny over P2P exchange venues and crypto trading persists, as evidenced by recent detentions.
In Kenya, the introduction of a Digital Asset Tax in 2023 was followed by repeal in 2025, leading to complex compliance for users and providers.
Summary
Stablecoins facilitate essential economic activities for many amidst soaring prices and limited resources across Nairobi and Lagos. Their compatibility with widely-used mobile payment systems enhances their functionality, while user-focused services emerge in various fintech solutions. Understanding these developments can empower individuals and businesses in managing their financial needs effectively, even as they traverse regulatory and market challenges.
