Stablecoins in Africa:

Translating Global Principles into Local Regulatory Practice Paper

EXECUTIVE SUMMARY Stablecoin adoption is accelerating globally, with particularly significant implications for African markets where cross-border payments remain costly, foreign currency liquidity is uneven, and financial inclusion gaps persist. Across the continent, stablecoins are already being used for remittances, peer-to-peer transfers, trade settlement, and as a store of value in response to currency volatility. Regulatory approaches must therefore respond to an active and evolving ecosystem rather than a purely emerging one.

Against this backdrop, this African Chapter of GDF’s Global Stablecoin Regulatory Playbook is strategically important. It provides a contextual lens to translate the regulatory principles identified in the Playbook into approaches that reflect African market realities. Its purpose is to support the consistent and practical implementation of these principles in ways that are aligned with both the relevant recommendations by international standard setting bodies and local market realities, development objectives, and institutional capacities.

The scope of this chapter is focused and aligned to the Global Stablecoin Regulatory Playbook. It examines the regulatory treatment of fiat-backed stablecoin issuers, recognising their growing relevance across African markets. It does not intend to categorise, define, or prescribe regulatory approaches for the broader universe of digital assets, such as tokenised deposits or other crypto-assets. Instead, it concentrates on how the core stablecoin principles presented in the Playbook can be applied in practice within African market contexts.

The paper highlights several key insights for policymakers. First, stablecoin adoption in Africa is already shaped by cross-border use cases, particularly remittances and access to foreign currency, which raises distinct macro-financial considerations including currency substitution and capital flow dynamics. Second, many widely used stablecoins are issued offshore, creating a structural supervisory asymmetry in which domestic authorities must manage risks arising from instruments beyond their direct regulatory reach. Third, reserve design, custody, and disclosure requirements must be calibrated to jurisdiction-specific factors, including shallow capital markets, foreign exchange constraints, and varying levels of institutional capacity. Finally intermediaries — including exchanges, wallet providers, and payment gateways — play a central role in how stablecoins function in practice, particularly for retail users.

The paper further emphasises that implementation is as critical as policy design. Given the pace of market development and varying levels of supervisory capacity, a phased and proportionate approach is required. The implementation journey typically starts with identifying the jurisdiction’s policy on stablecoins as a first step within the roadmap or the action plan. In practice, many regulatory frameworks move on by bringing existing virtual asset service providers (VASPs), including exchanges, wallet providers, and fiat on- and off-ramp channels, within the regulatory perimeter, in line with established expectations such as FATF Recommendation 15 and helping to secure immediate visibility and oversight of key domestic control points, even where stablecoin issuers are located offshore.

From this foundation, regulatory approaches can evolve: clarifying legal classification, strengthening inter-agency coordination, and introducing consultation and testing mechanisms (such as sandboxes or pilot regimes) for genuinely new products or business models. This allows innovation to be assessed in a controlled environment, while ensuring that already-active intermediaries are subject to appropriate licensing, supervision, and compliance requirements from the outset.

Finally, the paper underscores the importance of global and regional coordination and harmonisation given the inherent cross-border nature of Stablecoins. Greater alignment across African jurisdictions (and globally) through shared standards, supervisory cooperation, and regional payment initiatives can reduce fragmentation, limit regulatory arbitrage, and support more efficient and resilient financial ecosystems.

Overall, this chapter serves as a companion to the Global Playbook , supporting African regulators in applying global stablecoin regulatory principles in a manner that is contextually grounded, operationally feasible, and aligned with both financial stability and development objectives. 

Authors

This paper has been developed as part of the Alliance for Innovative Regulation’s ongoing work with regulators and central banks across the African continent to support regulatory readiness in the rapidly evolving payments innovation landscape and is co-authored by a working group comprising of:

Nick Cook, Alliance for Innovative Regulation
Lauren Cassells, Alliance for Innovative Regulation
Sonia Arenaza Chipa, CGAP
Ivo Jeník, CGAP
Mehmet Kerse, CGAP
Haocong Ren, CGAP
William Peracchio, Harvard Kennedy School — Master of Public Administration Student and MIT DCI

With Special Thanks

We would like to thank the following individuals and organisations for their contributions and support in finalising this paper:

Elise Soucie Watts and Jannah Patchay of Global Digital Finance (GDF) for the opportunity to publish this paper and to build upon the Global Stablecoin Regulatory Playbook , as well as for their invaluable support throughout its development.
Maria Teresa Chimienti, Dorothee Delort, Ahmed Faragallah, and Harish Natarajan of the World Bank for their input and support during the finalisation of this paper.
Neha Narula of the MIT Digital Currency Initiative for her input and review of this paper.
Public and private sector stakeholders from the global and African virtual assets ecosystem who engaged throughout the drafting process and attended the Alliance for Innovative Regulation’s workshops and forums , generously sharing their perspectives and insights on the nuanced regulatory considerations across different jurisdictions.