IMF researchers noted that stablecoins have “become a meaningful cross-border payments channel,” with the country receiving some $59 billion in crypto-asset inflows between July 2023 and June 2024, and accounting for 60% of stablecoin inflows within sub-Saharan Africa since 2019.
While conceding that stablecoin adoption brings “clear benefits” including financial inclusion and cheaper cross-border payments, undercutting conventional remittance channels, the IMF flagged monetary sovereignty and financial integrity as concerns.
Dollar-pegged stablecoins could represent a “digital form of dollarization,” weakening domestic monetary policy, while traditional financial monitoring systems fail to “capture” stablecoin transactions effectively, with anonymity raising the risk of “illicit finance.”
“Attempts to suppress stablecoin use are likely to be only partly effective,” the report said, urging a “pragmatic” response that allows for innovation while “managing risks.”
The authors suggested safeguarding monetary stability to combat “digital dollarization,” lauding recent macroeconomic reforms and tighter monetary policy. Other risk management strategies include strengthening oversight, improving data through “combining blockchain analytics with reporting on naira-stablecoin conversions," and upgrading existing payment infrastructure to “reduce reliance on unregulated channels” such as stablecoins.
