Opinion: The surge in Nigerian stablecoin cross-border payments is impacting traditional remittance and regulatory frameworks.

CoinFeed reported on June 16 that, according to the IMF website, Nigerian residents and SMEs are increasingly using USD-pegged stablecoins for cross-border payments via mobile wallets, making them a significant payment channel. The International Monetary Fund (IMF) cited data showing that Nigeria received approximately $59 billion in crypto assets between July 2023 and June 2024, accounting for about 60% of stablecoin inflows into sub-Saharan Africa since 2019, consistently ranking high in the Chainalysis Global Crypto Adoption Index. The article points out that while stablecoins play a role in mitigating the high costs and slow settlements of traditional cross-border payments, they exacerbate the risks of digital dollarization, weaken monetary policy transmission, and increase the difficulty of anti-money laundering and illicit capital flow supervision. The IMF recommends that Nigeria address these issues by strengthening its local currency stability, improving its stablecoin regulatory framework, enhancing blockchain data monitoring, and upgrading its cross-border payment infrastructure.